USD/CAD Price Forecast: Seems vulnerable; could test 200-day SMA near 1.4000 mark

The USD/CAD pair is exhibiting vulnerability, relinquishing gains made during the Asian session above 1.4100 and subsequently declining to a daily low near 1.4070. Recovering risk appetite and expectations of Federal Reserve rate reductions are exerting downward pressure on the USD, limiting the pair’s upside potential. Conversely, a decline in crude oil prices could weaken the Canadian Dollar, potentially mitigating further losses for the USD/CAD.
The pair’s inability to sustain levels above the 100-day Simple Moving Average (SMA), coupled with bearish technical indicators, reinforces a negative outlook. Continued weakness below the 1.4060-1.4055 range, and subsequently the year-to-date low around 1.4030-1.4025, could pave the way for a test of the 200-day SMA near the 1.4000 level.