USDCAD Weekly Outlook - Week of March 23, 2026
When momentum aligns, we move.
Week-in-Review (March 16-20)
OHLC Data: Open 1.3595 | High 1.3605 | Low 1.3522 | Close 1.3540
Weekly Change: -55 pips (-0.4%)
MCM State Progression: Distribution Phase → Early Markdown
Key Events: USDCAD declined steadily on broad dollar weakness and firmer oil prices. Break below 1.3560 support Wednesday confirmed bearish structure. CAD strengthened on WTI crude +3.2% weekly gain. Weekly close at 1.3540 suggests markdown phase targeting 1.3480-1.3500 support zone. Risk-on flows and commodity strength supporting loonie.
Supply/Demand Zone Map
Fresh Weekly Zones:
- Supply Zone A: 1.3560-1.3580 (Validity: 9/10) - Fresh distribution zone, former support flipped resistance
- Demand Zone A: 1.3480-1.3510 (Validity: 8/10) - Major weekly support from February
Multi-Touch Zones:
- Supply Zone B: 1.3640-1.3670 (3 touches, Validity: 7/10) - Strong institutional distribution
- Demand Zone B: 1.3420-1.3450 (2 touches, Validity: 6/10) - Multi-week support base
Flipped Zones:
- 1.3560-1.3570: Former support now resistance (flipped Wednesday, Validity: 8/10)
Support/Resistance Matrix
| Level | Price | Type | Strength | Distance | Weekly Context |
|---|---|---|---|---|---|
| R3 | 1.3670 | Supply Zone | Strong | +0.96% | Multi-touch resistance |
| R2 | 1.3610 | Weekly | Medium | +0.52% | Minor resistance |
| R1 | 1.3570 | Flipped | Medium | +0.22% | Former support |
| Current | 1.3540 | - | - | - | Weekly close |
| S1 | 1.3510 | Intraday | Weak | -0.22% | Friday's low |
| S2 | 1.3480 | Demand | Strong | -0.44% | Major support zone |
| S3 | 1.3435 | Multi-touch | Very Strong | -0.78% | Multi-week demand |
Liquidity Hunt Forecast
Primary Hunt Targets:
1. 1.3505-1.3515 Lows (Probability: 75%) - Friday's lows vulnerable to early week sweep
2. 1.3570 Highs (Probability: 55%) - Short-covering bounce into resistance possible
3. 1.3480 Stop Cluster (Probability: 65%) - Major support target by mid-week on oil strength
Liquidity Profile: Downside liquidity favored. Smart money likely distributing bounces into 1.3560-1.3570 resistance.
Weekly Fear Factor Assessment
Market Conditions:
- DXY: 103.45 (↓ -0.6% weekly) - Dollar weakness primary driver
- VIX: 16.8 (+2.1 pts) - Elevated but CAD outperforming on oil strength
- US10Y: 4.18% (-14bps) - Declining yields supportive for CAD
- WTI Crude: $78.45 (+3.2% weekly) - Oil strength major CAD tailwind
- COT Data: CAD net longs increased by 7K contracts, commercials neutral - bearish USD/CAD positioning
Economic Calendar (Week Ahead):
- Wed 3/25: FOMC Minutes (High impact) - Dovish tone accelerates USDCAD decline to 1.3480
- Fri 3/27: Core PCE (High impact) - Soft inflation = further USD weakness vs CAD
Fear Factor Score: 5/10 (Neutral - Bearish USD)
Week-Ahead MCM State Forecast
Current State: Early Markdown Phase (Bearish Continuation)
Expected Transition: Markdown continuation → Potential accumulation at 1.3435
Probability: 65% lower, 35% consolidation at 1.3480
Catalyst: Dovish FOMC + sustained oil strength = breakdown below 1.3480 toward 1.3435
Invalidation: Weekly close above 1.3580 (supply zone breakout)
Narrative: USDCAD in confirmed markdown following 1.3560 breakdown. Dollar weakness and oil price strength driving decline. Expect continuation toward 1.3480-1.3500 demand zone with minor bounces offering short entries at 1.3560-1.3570 resistance. Oil price trajectory key determinant of downside momentum.
Swing Trade Opportunities
| Setup | Entry Zone | Ideal Entry Days | TP1 | TP2 | SL | Hold Duration | Risk:Reward |
|---|---|---|---|---|---|---|---|
| Short Retest | 1.3560-1.3575 | Mon-Tue | 1.3510 | 1.3480 | 1.3595 | 2-3 days | 1:2.6 |
| Breakdown Short | 1.3475-1.3490 | Wed-Thu | 1.3440 | 1.3410 | 1.3520 | 3-4 days | 1:2.4 |
| Long Reversal | 1.3430-1.3450 | Thu-Fri | 1.3500 | 1.3540 | 1.3410 | 2-3 days | 1:2.7 |
Primary Setup: Short retest of 1.3560-1.3570 flipped resistance early week, targeting 1.3480 demand zone by Thursday.
Session-by-Session Playbook
Monday-Tuesday: Expect relief bounce toward 1.3560-1.3575 resistance for optimal short entry. North American session key for CAD pairs. Best short entry Tuesday if rally gets rejected at resistance.
Wednesday-Thursday: FOMC Minutes Wednesday 2pm EST - dovish tone accelerates decline toward 1.3480-1.3500 demand zone. Durable Goods/Jobless Claims Thursday add volatility. Watch for exhaustion at 1.3480 support.
Friday: Core PCE 8:30am EST - soft inflation could trigger final push below 1.3480 toward 1.3435. If already oversold, expect short-covering. Monitor oil price correlation.
Risk Events Calendar
| Date | Time (EST) | Event | Expected Impact | Pairs Affected |
|---|---|---|---|---|
| Wed 3/25 | 2:00 PM | FOMC Minutes | HIGH | USDCAD, All USD pairs |
| Thu 3/26 | 8:30 AM | Durable Goods | MEDIUM | All USD pairs |
| Thu 3/26 | 8:30 AM | Jobless Claims | MEDIUM | All USD pairs |
| Fri 3/27 | 8:30 AM | Core PCE | HIGH | USDCAD, All USD pairs |
Weekly Momentum View
USDCAD enters the week in confirmed markdown phase following 1.3560 breakdown. Macro backdrop of dollar weakness and oil price strength creates bearish tailwinds. FOMC Minutes and Core PCE represent key catalysts for acceleration toward 1.3480-1.3435 support cluster. Short-term bounces into 1.3560-1.3570 resistance offer strategic short entries with favorable risk-reward. Oil price strength remains critical supportive factor for CAD, watch for correlation divergence.
Bias: Short
Confidence: Medium-High (7/10)
Strategic Approach: Sell rallies into 1.3560-1.3575 resistance, target 1.3480/1.3435 support. Trail stops on extension below 1.3480.
Market Composite Method analysis by Momentum FX Trading