USD/CAD Rally Tests Major Resistance Amid Rising Momentum

The USD/CAD exchange rate has seen a significant rally over the past week, logging four consecutive weekly gains and rising by nearly 3.4% from its August low. This surge has pushed the pair to test major resistance levels, with the year's highest closing price now within reach.

According to Michael Boutros, Senior Market Analyst at StoneX Media, the USD/CAD rally is a result of strong momentum, with daily readings reaching their highest since June. However, this upward trend may be nearing its end, as recent history suggests that each seven-day advance has been followed by at least one day of pause.

A close below the pitchfork median line with an RSI under 70 could potentially lead to a pullback in the market. This is particularly concerning given the upcoming Federal Reserve speakers, core PCE inflation data, U.S. nonfarm payrolls, and Canada employment report, all of which are set to impact the currency markets.