USD/CAD Retreats After Failing to Hold Above 200-Day Moving Average

USD/CAD has pulled back after failing to sustain gains above two critical technical levels during its May rebound. The pair, which declined sharply through April, staged a recovery this month that pushed prices above the 61.8% Fibonacci retracement of the March 31 high at 1.38068 and the 200-day moving average at 1.3813. However, bulls were unable to maintain momentum above these resistance zones, triggering a pullback as sellers emerged at these technically significant levels. The rejection at the 200-day MA is particularly noteworthy, as this indicator often serves as a long-term trend filter for institutional traders. The inability to hold above 1.3813 suggests that bearish pressure from the broader April downtrend may still be dominant. Traders should watch for a decisive daily close above the 200-day MA to confirm a trend reversal, while a failure to reclaim this level could see the pair retesting lower support zones near the 50% retracement. Near-term price action remains technically driven with mixed directional signals.