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USD/CAD Stabilizes at 1.3730 as Markets Await Canadian Jobs Report and Fed Rate Cut Speculation

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  • August 8, 2025
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USD/CAD is stable around 1.3730 in anticipation of Canada’s July jobs report, with investors preparing for a possible hike in the unemployment rate to 7% and weaker job growth versus May. The pair continues to trade range-bound as the US Dollar falters with increasing expectations that the Federal Reserve will reduce interest rates in September, pushing the greenback to trade just off a one-week low. The focus now shifts towards the labor market data, which may dictate the Bank of Canada’s monetary policy perspective and decide the direction of the pair’s next move. KEY LOOKOUTS •  July’s employment report is supposed to reflect weaker job growth of 13.5K compared to 83.1K in May, as unemployment increases to 7%. •  Markets are factoring in a highly probable September rate cut, which is driving down the US Dollar. •  Support at 1.3880 is critical, while a fall below 1.3540 will set the stage for additional weakness towards 1.3500 and 1.3420. •  Labor market outcomes may affect the Bank of Canada’s position on subsequent interest rate moves. USD/CAD is stabilizing around 1.3730 with traders waiting for Canada’s July jobs report, which is likely to post softer job growth and an increase in the unemployment rate to 7%. The US Dollar continues to struggle, with investors nearly fully factoring in a Federal Reserve September rate cut, leaving the greenback close to recent lows. Technical indicators suggest a sideways trend with the 20-day EMA as support and the 14-day RSI trading at around 50. The impending labor market release will be crucial in determining expectations regarding the Bank of Canada policy course and may determine the pair’s next breakout direction. USD/CAD is stable at 1.3730 as the markets are waiting for Canada’s July employment data, which is expected to reveal slower employment and increased joblessness. Fed rate cut expectations still pressure the US Dollar, and the pair remains in a narrow channel. • USD/CAD remains flat at 1.3730 in anticipation of Canadian July job data. • Markets anticipate job growth would slow to 13.5K from 83.1K last May. • Canadian unemployment rate to increase to 7% from 6.9%. • Fed rate reduction in September still highly expected, bearing down on the US Dollar. • US Dollar Index trading close to a week’s low of 98.00. • Stronger technical support at 1.3540; stronger resistance at 1.3880 and 1.4000. • Outcome of labor data can have an effect on the monetary policy stance of the Bank of Canada. The USD/CAD currency pair remains steady as investors wait for Canada’s July employment report to be released, which is likely to reflect on slowing hiring and a slight increase in the unemployment rate to 7%. Economists are predicting that the Canadian economy created only 13.5K jobs in July, down sharply from the 83.1K in May. The information will be carefully monitored for its effects on the wellbeing of the labor market as well as its possible impact on Bank of Canada’s future policy. USD/CAD DAILY PRICE CHART SOURCE: TradingView In the meantime, the US Dollar is under pressure as more and more investors are betting on a September Federal Reserve rate cut. Market sentiment has been influenced by the possibility of a weaker US economic outlook, coupled with news reports that Fed Governor Christopher Waller might take over Jerome Powell’s Fed Chair position. All this has made traders keep their guard up, while market attention is squarely on the Canadian jobs report for new signals on USD/CAD’s direction. TECHNICAL ANALYSIS USD/CAD is at its 20-day Exponential Moving Average (EMA) at approximately 1.3730, a state of consolidation. The 14-day Relative Strength Index (RSI) is around the neutrality level of 50, an indicator that there is no dominance in either direction. A solid breakout over the August 1 high of 1.3880 might open the door to the May 15 high at 1.4000 and the April 9 low at 1.4075. On the other hand, a fall below the June 16 low of 1.3540 would set the stage for further losses towards the major psychological level of 1.3500 and September 25 low of 1.3420. FORECAST Should Canada’s July job data be weaker than anticipated, it might pressure the Canadian Dollar and drive USD/CAD upward. A breach above the resistance of 1.3880 would most probably pave the way towards the May 15 high at 1.4000, with additional upside towards 1.4075 if bearish pressure gathers momentum. Ongoing US Dollar weakness might be in check with robust US data or bullish Fed rhetoric, which may catalyze the pair’s rally. Conversely, even better-than-anticipated Canadian labor market data may lift the Loonie and pull USD/CAD down. Breaking the June 16 low of 1.3540 would presumably lead to a test of the psychological 1.3500 level, with potential extension towards the September 25 low of 1.3420. Any indication of growing Canadian economic resilience and ongoing Fed rate cut speculation may encourage bearish pressure on the pair.

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Commodities Oil – US Crude

USD/CAD Forecast: Bullish Bias Remains Above 1.3700 as Price Looks to Breakout from Bearish Channel

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  • July 16, 2025
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USD/CAD currency pair remains trading with a bullish bias above the 1.3700 level, underpinned by robust short-term momentum and a bullish technical configuration. Even as it consolidated inside a downtrend channel, the pair has been showing strength for the fourth session in succession, supported by the 14-day RSI remaining above the 50 level and price action still above the nine-day EMA. The short-term attention remains on the important resistance at the 50-day EMA around 1.3748, which if broken, can see a rally to the May high of 1.4016. Yet a breakdown of above short-term support at 1.3688 could leave the pair vulnerable to further losses towards multi-month bottoms. KEY LOOKOUTS • Look for a possible breakout above the 50-day EMA, which could pave the way for additional upside towards the 1.4016 level. • A breakdown below the nine-day EMA might undermine the short-term bullish momentum and cause a pullback towards June’s low of 1.3539. • The 14-day Relative Strength Index remaining above the middle-level 50 point signals sustained bullish inclination in the short term. • Watch price action near the top level of the declining channel at 1.3750 for hints on potential trend reversal or continuation. USD/CAD pair continues its rising trend, trading consistently above the level of 1.3700 in renewed bullish momentum. Although ranged within a falling channel, the pair’s strength is underpinned by the 14-day RSI remaining above 50 and price action above the nine-day EMA indicating short-term bullish potential. Principal resistance is now at the 50-day EMA around 1.3748, which is also the top of the channel. A clear break above this level may speed gains to the May high of 1.4016, with a failure to hold above 1.3688 likely to tempt bearish pressure. USD/CAD remains firm above 1.3700, with a bullish RSI and short-term moving averages giving it a supportive base. A breakout above 1.3748 may set the stage for more gains, with support at 1.3688 still pivotal. The pair remains within a falling channel, prompting traders to remain on guard. • USD/CAD is trading above 1.3700, its fourth day of consecutive gains. • The pair is still in a downtrending channel, which suggests continued consolidation. • The 14-day RSI is north of the 50 level, which is bullish in the short term. • The first resistance is at the 50-day EMA at 1.3748, which coincides with the top of the channel. • A break through 1.3748 may take the pair to the May high of 1.4016. • Key support is at the nine-day EMA of 1.3688; a break could prompt a decline to 1.3539. • Additional declines could reach multi-month lows at 1.3419 and the channel base at 1.3340. The USD/CAD currency pair has provided steadfast strength over recent trading sessions, an indication of restored investor faith in the US Dollar as global market dynamics shift. Economic announcements, interest rate forecasts, and geopolitical news have all played a part in the pair’s direction. Market participants are keeping a close eye on the overall macroeconomic context, particularly with regard to oil prices and North American trade flows, which in the past have influenced the Canadian Dollar’s performance. USD/CAD DAILY PRICE CHART SOURCE: TradingView Besides, market sentiment is also sensitive to major Federal Reserve and Bank of Canada announcements. The divergences in monetary policy directions between the two central banks usually create volatility for the USD/CAD currency pair. Since both economies are working their way through inflationary pressures and growth expectations, the pair tends to be quite active owing to fundamental changes and investor positioning. TECHNICAL ANALYSIS USD/CAD is now moving within a falling channel, indicating a larger consolidation period. Yet, the pair has a bullish bias in the short term, as it is above the nine-day Exponential Moving Average (EMA) and the 14-day Relative Strength Index (RSI) is above the 50 mark. The nearest resistance comes at the 50-day EMA of 1.3748, which happens to be the upper line of the channel. A successful breakout above this zone could signal a shift in medium-term momentum, while failure to do so may keep the pair confined within its current range. FORECAST If USD/CAD can break through the pivotal resistance at the 50-day EMA around 1.3748 and the top of the falling channel, a more powerful bull trend could be triggered. Such a breach would enhance medium-term sentiment and potentially set the stage for a run toward the May high of 1.4016. Persistent buying interest above that level could also propel the pair into higher resistance levels, underpinned by positive momentum indicators. Conversely, a failure to stay above the near-term support at the nine-day EMA of 1.3688 may trigger fresh selling pressure. A fall below this level might expose the pair to further downward moves towards the June low of 1.3539. Fresh bearish pressure might send USD/CAD even lower towards 1.3419, which is the lowest print since February, with subsequent possible testing of the down channel’s lower border around 1.3340.

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Currencies GBP/USD

Pound Sterling Climbs on Uncertainty Over US Tariffs and BoE Warnings on Economic Risk

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  • July 10, 2025
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Pound Sterling (GBP) rose against the US Dollar (USD) on Thursday, trading around 1.3600, as investor mood remained nervous with increasing uncertainty over US trade talks and fresh retaliatory tariffs that are scheduled to go into effect on August 1. Notwithstanding warnings issued by the Bank of England (BoE) regarding large economic dangers—such as geopolitical tensions, an increase in national debt, and poor business sentiment—the British currency got some respite. The US Dollar, meanwhile, lost a bit of ground as markets absorbed the Federal Reserve’s dovish tone in its June meeting minutes, which signaled possible rate cuts if tariff-induced inflation stays in check. KEY LOOKOUTS • Markets are keeping a close eye on whether the US clinches trade agreements with important partners such as China, the Eurozone, Canada, and Mexico prior to the onset of new reciprocal tariffs. •  The UK’s monthly factory output and GDP for May are awaited by investors, with GDP predicted to bounce back by 0.1% following April’s 0.3% decline. •  Warnings by the Bank of England regarding escalating geopolitical tensions, a fractured global marketplace, and rising sovereign debt will also impact investor sentiment towards the Pound. •  FOMC minutes indicate potential interest rate reductions this year, depending on the trajectory of tariff-induced inflation, which can continue to put pressure on the US Dollar. The Pound Sterling rose against the US Dollar on Thursday to trade around the 1.3600 level as market players reacted to a combination of economic and geopolitical events. Investor attention was on rising trade tensions, with the US scheduled to levy new retaliatory tariffs on 21 countries from August 1, adding volatility to worldwide markets and exerting pressure on the US Dollar. In spite of the Bank of England’s warning report flagging high economic risks like geopolitics instability, increased national debt, and muted business investment sentiment, the Pound firmed up. Dealers are also looking forward to future UK GDP and factory production figures, as the dovish policy bias from the Federal Reserve added weight to further weaken the Greenback. The Pound Sterling hovers at 1.3600 against the US Dollar in increasing uncertainty about US trade policy and impending reciprocal tariffs. Even as the Bank of England cautions rising economic threats, the GBP remains firm while investors hold out for pivotal UK economic reports and news of international trade talks. • GBP/USD hovers near 1.3600 as the Pound slightly improves during Thursday’s European session. • US dollar falls on uncertainty surrounding future reciprocal tariffs that will kick in on August 1. • Bank of England issues a warning over economic threats, such as geopolitical tensions, increasing sovereign debt, and poor business morale. • British factory and GDP data for May are expected; GDP is expected to increase by 0.1% following a reduction in April. • US President Trump announces 50% tariffs on copper imports and new trade measures with 21 countries. • FOMC minutes reveal ambivalent sentiment with two members of the Fed supporting interest rate cuts in July. • Technical indicators hint at a neutral trend with RSI around 50 and price around the 20-day EMA. The Pound Sterling was stable against the US Dollar on Thursday as market focus continued to be on international trade updates and UK economic risks. The British currency remained resilient in spite of a conservative mid-year Financial Policy Committee (FPC) report from the Bank of England, cautioning of increasing risks to the UK economy. The report also noted risks like geopolitical tension, disintegration of global trade, stress on sovereign debt, and low investment sentiment. These risks, says the FPC, threaten financial stability and may have implications for future economic growth. GBP/USD DAILY PRICE CHART SOURCE: TradingView Meanwhile, in the United States, the trade landscape continued to evolve as President Trump announced new reciprocal tariffs affecting 21 nations, including major partners like Japan and South Korea. These tariffs are set to take effect on August 1 and are part of a broader push for more favorable trade terms. Though trade deals with the UK and Vietnam have been agreed, those with other important partners like China, Canada, Mexico, and the Eurozone are uncertain. The threat of escalating trade tensions is making global markets tread carefully, as investors seek clear signals on the direction of international trade relationships. TECHNICAL ANALYSIS GBP/USD pair is moving near the 20-day Exponential Moving Average (EMA) at 1.3590, reflecting a neutral short-term trend. The 14-day Relative Strength Index (RSI) is around the 50.00 mark, indicating a lack of significant momentum in either direction. A fall below the important psychological support level of 1.3500 may indicate fresh selling pressure, and a strong break above 1.3700 may set the stage for further advances towards the multi-year high around 1.3800. Overall, the duo seems to be in the process of consolidation, waiting for new catalysts for directional action. FORECAST If there are positive breakthroughs in US trade talks, especially with major partners such as China, Canada, and the Eurozone, investor appetite for risk would grow, weakening the US Dollar and boosting the Pound Sterling. Also, better-than-forecast UK GDP and factory production statistics would improve faith in the British economy, hopefully driving GBP/USD to resistance points at about 1.3700 and, if the rally is sustained, as high as the three-and-a-half-year peak around 1.3800. Conversely, if the US is unable to secure trade agreements prior to the August 1 tariff deadline, global trade tensions may escalate sharply, supporting the safe-haven US Dollar. In addition, if future UK economic data is disappointing or concern regarding increasing national debt and geopolitical risks accelerates, the GBP might be pressured. A fall below the 1.3500 psychological support point may lead to further losses towards the next significant point at 1.3400.

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