• USD/CAD bulls are in the market following a hawkish Fed chair Powell. 
• Bulls eye the 1.3850s but a retest of prior resistance could be in order.

USD/CAD is riding dynamic support after Federal Reserve's chairman Jerome Powell said that the Fed is prepared to increase the pace of rate hikes if data indicates it is warranted:

"The latest economic data have come in stronger than expected, which suggests that the ultimate level of interest rates is likely to be higher than previously anticipated. If the totality of the data were to indicate that faster tightening is warranted, we would be prepared to increase the pace of rate hikes," Fed's Powell said in his testimony. 

As a consequence, the yield on the US 10-year Treasury note rose to 4% before easing back to 3.96%, remaining marginally below the three-month high of 4.07% touched on March 2nd as investors assessed the pace of future rate hikes by the Federal Reserve. This gave the greenback a boost and USD/CAD remains better bid as the following illustrates: