USD CAD Forecast for 2024, 2025-2026 and Beyond | LiteFinance (2024)

The USD to CAD exchange rate fluctuates constantly, leaving investors to wonder whether prices will rise or fall in the coming years. Forecasting the dollar-to-Canadian dollar rate is complex, with factors like interest rates, economic growth, commodity prices, and political events all impacting. By examining historical trends, relative economic performance, and monetary policy differences between the US and Canada, our forecast aims to help investors and traders make informed judgments.

To build our model, we will analyze events like interest rate decisions, oil prices, and GDP projections. Whether you are planning transactions, hedging exposure, or looking to trade the Canadian dollar, our long-term USD to CAD outlook can guide your strategy. Stay ahead of market movements by reading our detailed forecast covering the next several years.

Main takeaways: USD CAD Forecast 2024–2029

• The USD/CAD rate is expected to remain relatively stable in 2024, fluctuating between 1.33-1.35 CAD on average, before declining to 1.31-1.32 CAD later in the year (ExchangeRates.org.uk, as for February 22, 2024).

• Analyst forecasts for 2025 predict further gradual depreciation of the USD against the CAD, with the exchange rate falling from 1.31561 CAD to around 1.29-1.31 CAD by the end of the year (ExchangeRates.org.uk, as for February 22, 2024).

• Long-term projections for 2026-2028 vary significantly – Gov Capital forecasts substantial increases to over 7 CAD per USD by 2028, while WalletInvestor expects more modest gains to approximately 1.45 CAD per USD over the same period (as for February 22, 2024).

• Forecast uncertainty grows over longer time horizons. Key drivers like interest rates, oil prices, economic indicators, political developments, and inflation can trigger pricing swings.

USD CAD Price Today Coming Days and Week

When analyzing the price of USD/CAD (US Dollar to Canadian Dollar) for the short term, consider these technical analysis tools:

• Moving Averages: Utilize short-term moving averages, like the 5-day and 10-day, to identify current trend directions. Moving average crossovers can signal potential buying or selling opportunities.

• Relative Strength Index (RSI): The RSI is instrumental in identifying overbought (above 70) or oversold (below 30) conditions, suggesting possible price reversals.

• MACD (Moving Average Convergence Divergence): Observe the MACD for momentum shifts, especially when the MACD line crosses above or below the signal line, indicating potential entry or exit points.

• Bollinger Bands: These bands can help assess market volatility. Price touching or exceeding the bands might indicate an overextended market condition, potentially leading to a reversal.

• Fibonacci Retracements: Apply Fibonacci retracements to identify potential support and resistance levels based on previous price movements, offering targets for short-term trades.

• Candlestick Patterns: Look for specific candlestick patterns (e.g., hammers, engulfing patterns, dojis) that may indicate short-term price movements and trader sentiment.

• Stochastic Oscillator: This momentum indicator can help confirm potential trend reversals by identifying overbought or oversold conditions, offering additional insights alongside the RSI.

When forecasting the weekly price of USD/CAD (US Dollar to Canadian Dollar), consider the following key factors:

• Economic Indicators: Keep an eye on key economic data releases from both the United States and Canada, such as employment figures, inflation rates, GDP growth, and retail sales. These indicators can significantly influence the relative strength of each currency.

• Central Bank Policies: Stay informed about policy decisions and statements from the Federal Reserve (Fed) and the Bank of Canada (BoC). Changes in interest rates, monetary policy updates, and future economic outlooks provided by these institutions can impact the USD/CAD exchange rate.

• Oil Prices: Given Canada's status as a major oil exporter, fluctuations in oil prices can affect the Canadian Dollar's value. Monitor global oil price trends, as higher prices can strengthen the CAD, affecting the USD/CAD pair.

• Market Sentiment: Assess overall market sentiment and risk appetite. Changes in investor confidence, driven by global economic news or geopolitical events, can influence currency movements, including USD/CAD.

• Technical Analysis: Utilize technical analysis tools such as Moving Averages to gauge trend directions, RSI to identify overbought or oversold conditions, and MACD for momentum shifts. Key support and resistance levels should also be considered, as they can influence price movements.

• Trade Relations: Pay attention to any developments in trade relations between the US and Canada, as well as any significant changes in trade policies, which can affect economic prospects and currency valuation.

• Global Economic Environment: Consider the broader global economic conditions, including developments in major economies and financial markets, as these can influence risk sentiment and currency movements.

Taking these factors into account can provide a comprehensive view of the potential price movement of USD/CAD over the coming week.

Analysts’ USD CAD Projections for 2024

Let's take a look at USDCAD's expert forecasts for 2024 (as for February 22, 2024).

Gov Capital's USD/CAD Price Forecast for 2024

According to Gov Capital, the USD/CAD exchange rate will substantially increase to 2.304 by December 30, 2024, representing an approximate 72.382% uptrend from current levels. However, currency markets can be dynamic and unpredictable, influenced by economic policies, sentiment, and events. Stakeholders should closely monitor indicators and trends that could sway the rate.

WalletInvestor's USD/CAD Price Forecast for 2024

WalletInvestor predicts a relatively stable but slightly fluctuating exchange rate throughout 2024. The forecasted exchange rates for each month show minor changes, beginning at about 1.347 in March and closing slightly higher at 1.1.361 in December.

ExchangeRates.org.uk's USD/CAD Price Forecast for 2024

According to ExchangeRates, the USD/CAD rate in Q1 2024 is expected to rise slightly to 1.3521, indicating a bullish trend at the start of the year. However, the forecast suggests a gradual decline in the USD/CAD exchange rate as the year progresses. Specifically, for Q2 2024, the rate is predicted to decrease to 1.3416 slightly. The downward trend continues, with the exchange rate expected to fall to 1.3171 in Q3 2024 and further to 1.3159 by the end of Q4 2024. These predictions suggest a bearish trend as the year progresses.

USD to CAD Technical Analysis

To determine the future USDCAD price over the short and long term, it is necessary to perform technical analysis in different timeframes, from a four-hour to a monthly chart. Such tools as MACD, RSI,the MA Cross, and the OBV will help you study the asset price chart in more detail. Using these indicators, you can determine support/resistance levels, likely pivot points, trend strength, and the overbought/oversold zones.

In conjunction with indicator analysis of the USDCAD pair, it is important to use the chart and candlestick patterns. This will allow you to obtain more accurate information about the balance of power between bulls and bears in the market.

Most often, you can spot such large price chart patterns as Double Bottom, Double Top, Head and Shoulders in the price chart. In addition, candlestick patterns such as Three Black Crows, Hammer, Inverted Hammer, and the so-called Stars quite often form in the price chart of the USDCAD pair.

Before forecasting the short-term and medium-term price changes, we should define the current market stage in the monthly chart.

You can see in the above chart that, since August 2012, the Canadian dollar has lost more than 40% of its value against the US dollar. This was facilitated by a price reversal around the level of 0.9496, after which a long upward trend began, which was going on until December 2015. Thus, the price chart began to draw a large Double Bottom pattern.

Since December 2015, the price has been moving in a wide sideways channel between the levels of 1.9999 and 1.3989. At the moment, the price is above the neckline of the double bottom pattern in the zone of 1.3509 and is directed upwards.

According to the MA Cross indicator, the Golden Cross pattern has formed in the area of 1.1999, where there is a dynamic support line - MA200. The MACD indicator is directed downwards and is in the negative zone near the zero value.

The RSI is moving sideways above 50, indicating a bullish trend. There are no intense surges in trading volumes according to the OBV indicator; the values are in a narrow sideways range, as is the price of the currency pair. According to preliminary analysis, bullish sentiment prevails in the market, which tends to grow.

USDCAD Forecast For Next Three Months

Let's make a USDCADforecast for the next three months using the H4 and D1 charts.

We can see an Ascending Triangle pattern forming in the four-hour chart. Bulls are pressing the price up, facing a horizontal resistance at 1.3543. The price is expected to break out the pattern and continue moving up with the next targets at 1.3626 and 1.3711.

According to the OBV indicator, there is a consistent increase in volumes, but the price is moving within a narrow upward consolidation. This indicates that the price is being held, and the asset is being accumulated by large players for a further breakout of the resistance level 1.3543.

The MACD indicator values started increasing sharply in the positive zone, which indicates an increase in buying pressure. The RSI is also rising, being above 63, which is a bullish signal. The MA Cross indicator has formed a Golden Cross below the level of 1.3431.

In the daily chart, the price also moves within the ascending triangle chart pattern, giving conflicting signals. A confirming factor of the increasing bullish trend is the construction of the Inverted Hammer, Hammer, and Bullish Engulfing patterns at the levels of 1.3360-1.3431. They signal a trend reversal upward.

The MACD indicator values, after a three-week decline, resumed growth in the positive zone, which indicates buying pressure. The RSI indicator is directed upward, being at level 61. But contrary to the bullish sentiment, the MA Cross indicator has drawn a Death Cross, which indicates a potential reversal down. According to the OBV indicator, there is a decline in trading volumes.

To confirm further price growth, the USDCAD price should consolidate above the level of 1.3543. An alternative scenario is possible if the bulls fail to hold the key support level of 1.3431.

Long-Term USDCAD Technical Analysis and Forecast for 2024

We shall continue projecting the USDCAD future price in the long term by analyzing the W1 chart.

In the weekly timeframe, there is a long-term consolidation in a wide sideways range of 1.3157-1.3989 since the beginning of September 2022. The instrument has formed a strong support level at 1.3157, strengthened by a dynamic support line, MA200.

In this zone, there are two reversal patterns, a Morning Star and a Gap in the Clouds, which emphasize the strength of buyers. Over the past two weeks, the price has formed a gap at 1.3498, where the short-term moving average MA50 lies. The gap could act as a new support level.

The uptrend is also confirmed by a Golden Cross at 1.3049. The MACD indicator is rising in the negative zone, approaching the zero border. The RSI is also growing, approaching 53, which confirms the beginning of a potential uptrend. Volumes, according to the OBV indicator, have been gradually growing since the beginning of July 2023.

Following the above analysis, I have compiled an approximate forecast of the minimum and maximum prices for each month of 2024 in the table below.

Long-Term Trading Plan for USDCAD

The technical analysis above showed that the currency pair remains likely to rise throughout 2024.

Trading plan for the next three months

Based on the analysis above, the USDCAD trading plan for the next three months is as follows:

• The price remains likely to grow in the suggested period. It will be relevant to buy when the price breaks out the upper border of the Ascending Triangle pattern at1.3543, which will signal entering purchases with targets at 1.3626-1.3784;

• The key support levels are 1.3431, 1.3360, 1.3289 and 1.3178;

• The key resistance levels are 1.3543, 1.3626, 1.3711 and 1.3784;

• Alternative scenario: the price breaks out the support level of1.3431, and the bearish pressure will drive the price down to 1.3360-1.3178.

Trading plan for 2024

Trading plan for the current year, based on the above technical analysis is below:

• The key resistance is currently level 1.3676, whose impulse breakout will suggest entering long trades with targets in the zone of 1.3989-1.4706;

• The key support levels for 2024 are 1.3157, 1.3049, 1.2723, 1.2469, 1.2288 and 1.1999;

• The key resistance levels are 1.3676, 1.3989, 1.4339 and 1.4706.

USD CAD Forecast for 2025

Let's take a look at USDCAD's expert forecasts for 2025 (as for February 22, 2024).

Gov Capital's USD/CAD Price Forecast for 2025

According to Gov Capital, in 2025, the US dollar to Canadian dollar exchange rate will fluctuate between a low of 1.406 in January and a high of 2.413 in October. Overall, the rate trended upwards through most of the year, starting below 1.5 in January and exceeding 2.4 by October. There were some dips in the summer and November, but the rate recovered. The average for the year was around 2.15.

WalletInvestor's USD/CAD Price Forecast for 2025

WalletInvestor provides a month-by-month forecast for 2025, showing a trend that fluctuates slightly over the year. The US dollar started 2025 at 1.360 CAD and ended at 1.389 CAD, showing an overall increase versus the Canadian dollar. During the year, the rate reached a low of 1.354 CAD in July and a peak of 1.387 CAD in November. Monthly changes fluctuated between a -0.63% drop in April and a 0.84% increase in October. The most significant dip and recovery happened between July and August.

ExchangeRates.org.uk's USD/CAD Price Forecast for 2025

ExchangeRates.org.uk's forecast for 2025 suggests a gradual depreciation of the USD/CAD pair. The US dollar started 2025 at 1.31561 CAD and ended at 1.29641 CAD in September, showing an overall decrease versus the Canadian dollar. The rate peaked at 1.31561 in early January and hit a low of 1.29641 in late September. There were some minor ups and downs throughout the year, but the general trend was downwards, with the rate dropping almost 2 cents from January to September 2025. The steepest single-day drops were around 0.001.

Long-Term USD CAD Forecast for 2026

Let's take a look at USDCAD's expert forecasts for 2026 (as for February 22, 2024).

Gov Capital's USD/CAD Price Forecast for 2026

Gov Capital's forecast for USD/CAD in 2026 presents a bullish and robust growth perspective, predicting a substantial rise in the currency pair. The data indicates an opening rate of around 3.572, with fluctuations throughout the year reaching peaks as high as 4.25.

WalletInvestor's USD/CAD Forecast for 2026

WalletInvestor's USD/CAD forecast for 2026 offers a detailed, month-by-month breakdown of expected exchange rate movements. The currency pair is projected to start the year at 1.385 and experience various minor fluctuations, with changes ranging from a decrease of 0.6% to an increase of 0.81%. This granular forecast suggests a year of relative stability with gentle upward and downward trends.

Long-Term USD CAD Forecast for 2027-2028

As for February 22, 2024,Gov Capital forecasts a substantial increase in the USD/CAD rate over 2027-2028. According to their model, the 1-year forecast for 2027 is around 3.574, steeply rising to approximately 7.8 by the end of 2028. The analysis indicates that although the USD/CAD currency pair has been experiencing a downtrend recently, it is expected to surge steadily over the next few years.

Wallet Investor's USD/CAD Price Forecast for 2027-2028

Wallet Investor expects a moderate rise in the USD/CAD currency pair over 2027-2028. According to their forecast, USD/CAD is estimated to reach around 1.420 in Q4 2027, increasing slightly to approximately 1.445 by Q4 2028. The analysis shows an oscillating trend continuing over the next few years, as for February 22, 2024.

Recent Price History of the USD CAD Pair

Over 2021-2023, the USD/CAD exchange rate experienced significant volatility stemming from shifts in global growth, monetary policies, commodity markets, and risk appetite. Relative US/Canada economic performance and oil price fluctuations saw USD/CAD reach recent highs of 1.37 CAD in October 2023 and sub-1.311 lows back in July 2023 – representing a 5%+ peak-to-trough range amid a three-year average of 1.3502 CAD. With inflation pressures, interest rate adjustments, and unpredictable geopolitics impacting major exporters like Canada, USD/CAD was left to oscillate unpredictably between bullish and bearish forces. This underscores the complex drivers at play for globally exposed currencies – where external shocks can trigger significant pricing swings even in a matter of months.

Which Factors Impact USD CAD Forecast?

• Interest Rates: Higher interest rates offer lenders in an economy a higher return than other countries, attracting foreign capital and causing the exchange rate to rise.

• Economic Indicators: Gross Domestic Product (GDP) growth rates, unemployment rates, and other significant economic reports that impact the economic outlook and, consequently, currency strength.

• Commodity Prices: Given Canada's significant export of commodities like oil, potash, and zinc, these prices can significantly affect the CAD's value of the CAD.

• Political Stability and Economic Performance: Political events, stability, and performance in both countries can affect investor confidence and influence currency strength.

• Inflation Rates: Generally, a country with a consistently lower inflation rate exhibits a rising currency value as its purchasing power increases relative to other currencies.

• Public Debt: Countries with large public debts are less attractive to foreign investors due to inflation and default risk. This can lead to a decrease in currency value.

Is USD/CAD Still a Good Investment?

In concluding the outlook for USD/CAD in 2024 and beyond, it's clear that the currency pair presents a complex investment landscape. The divergent forecasts and expert opinions highlight the sensitivity of USD/CAD to a range of economic, geopolitical, and market-specific factors. From interest rate differentials to global commodity trends, the factors influencing the pair's movements are as dynamic as they are varied.

Whether USD/CAD is a good investment hinges on an individual's investment goals, risk tolerance, and ability to stay informed about global economic trends. As with any investment in the volatile forex market, diversification and a keen eye on emerging economic trends are indispensable strategies for those looking to engage with USD/CAD in the coming years.

Price chart of USDCAD in real time mode

The content of this article reflects the author’s opinion and does not necessarily reflect the official position of LiteFinance. The material published on this page is provided for informational purposes only and should not be considered as the provision of investment advice for the purposes of Directive 2004/39/EC.