empty
02.12.2024 02:50 PM
USD/CAD: Analysis and Forecast

This image is no longer relevant

Today, the USD/CAD pair is gaining positive momentum, breaking a three-day losing streak and halting a recent corrective pullback from its highest level since April 2020, near 1.4179–1.4180, reached last Tuesday.

The tariffs proposed by U.S. President Donald Trump against the three largest trading partners of the United States — Canada, Mexico, and China — continue to pressure the Canadian dollar. This, coupled with renewed demand for the U.S. dollar, serves as another supportive factor for the currency pair.

In a weekend post, Trump threatened a 100% tariff on BRICS countries — Brazil, Russia, India, China, and South Africa — if they replace the U.S. dollar with another currency for international transactions. This statement has fueled speculation that his tariff policies could resurface inflationary pressures, prompting the Federal Reserve to halt rate cuts or even consider rate hikes. These prospects have triggered another surge in U.S. Treasury yields, further bolstering demand for the U.S. dollar.

This image is no longer relevant

Additionally, cautious market sentiment continues to benefit the greenback, supporting USD/CAD demand. Even a slight rise in oil prices failed to offset the losses of the commodity-tied Canadian dollar. This suggests that, in the short term, the path of least resistance for the pair remains upward.

This image is no longer relevant

Traders may refrain from aggressive directional positions. This is due to crucial U.S. macroeconomic data scheduled for the start of the new month. This week's U.S. session begins with significant economic reports, including the ISM Manufacturing Index, while the primary focus will remain on the NFP non-farm payrolls report, set for release on Friday.

These employment figures will provide crucial insights into the Fed's rate policy and influence the U.S. dollar, driving USD/CAD momentum.

Bullish oscillators on the daily chart confirm a short-term positive forecast, supporting prospects for additional gains. Subsequent buying above 1.4045 could enable spot prices to reclaim the 1.4100 level. The momentum may lift USD/CAD toward its multi-month high near 1.4179–1.4180, eventually reaching the 1.4200 round level. Beyond this, the pair could aim for its 2020 high.

This image is no longer relevant

The 1.4000 psychological level now serves as the first line of support against further declines, ahead of Friday's multi-day low near 1.3980. Failure to hold these levels could trigger technical selling, leading to a deeper correction from the multi-year peak.

Below this, USD/CAD could drop toward support at 1.3955, then 1.3925, or last week's swing low. Further losses may test the 1.3900 round level, and a breach could push spot prices toward the November low of 1.3820–1.3815.

Irina Yanina,
Analytical expert of InstaForex
© 2007-2025
Select timeframe
5
min
15
min
30
min
1
hour
4
hours
1
day
1
week
Earn on cryptocurrency rate changes with InstaForex
Download MetaTrader 4 and open your first trade
  • Grand Choice
    Contest by
    InstaForex
    InstaForex always strives to help you
    fulfill your biggest dreams.
    JOIN CONTEST

Recommended Stories

USD/JPY. Analysis, Forecast, and Current Market Situation

Intraday demand for the Japanese yen remains steady, accompanied by broad-based U.S. dollar weakness, contributing to the decline in the USD/JPY pair. Rising expectations that the Bank of Japan

Irina Yanina 12:55 2025-06-26 UTC+2

XAU/USD. Analysis and Forecast

Gold prices are showing moderate gains for the second consecutive day, though they remain below the 3,350-dollar level. Intraday demand for the Japanese yen persists alongside broad U.S. dollar weakness

Irina Yanina 12:34 2025-06-26 UTC+2

USD/CHF. Analysis and Forecast

The USD/CHF pair has remained under pressure for the fourth consecutive day, falling back to levels last seen in 2011. Bearish sentiment toward the U.S. dollar persists amid concerns over

Irina Yanina 12:04 2025-06-26 UTC+2

Trump Again Criticizes the Fed for Being Too Slow

On Wednesday, the U.S. dollar sharply declined against major currencies after President Donald Trump stated that he has three or four candidates in mind to replace Federal Reserve Chair Jerome

Jakub Novak 10:59 2025-06-26 UTC+2

Investors Recall the Chronic Weakness of the Dollar (Further Decline in #USDX and USD/JPY Possible)

The markets continue to be dominated by the theme of Iran-Israel negotiations, previously initiated by the United States. Whether actual agreements are reached or not will have a noticeable impact

Pati Gani 09:19 2025-06-26 UTC+2

The Market Has Found a Cure for All Troubles

It seems that the heavens are aligned with Donald Trump's desires. The U.S. President's successes in the Middle East have led to a new perspective on the policies pursued

Marek Petkovich 09:04 2025-06-26 UTC+2

What to Pay Attention to on June 26? A Breakdown of Fundamental Events for Beginners

Very few macroeconomic reports are scheduled for Thursday, and the market this week has shown a clear intention to continue the upward trend that has lasted for five months. Yesterday

Paolo Greco 07:16 2025-06-26 UTC+2

GBP/USD Overview – June 26: July 9 Is Approaching

The GBP/USD currency pair remained stagnant for most of Wednesday. Let's recall an old technical signal: if the price updates a significant extreme and immediately pulls back, there

Paolo Greco 03:39 2025-06-26 UTC+2

EUR/USD Overview – June 26: Jerome Powell Said Nothing New

The EUR/USD currency pair remained completely calm throughout Wednesday. Let's recall that this week began with a storm, provoked—of course—by Donald Trump, who first announced a ceasefire between Iran

Paolo Greco 03:39 2025-06-26 UTC+2

The Euro Regains the Initiative

The euro is attempting to resume its upward movement, although not many economic reasons support this scenario. Inflation in May rose in line with the ECB's expectations, which only strengthened

Kuvat Raharjo 00:43 2025-06-26 UTC+2
Can't speak right now?
Ask your question in the chat.
Widget callback
 

Dear visitor,

Your IP address shows that you are currently located in the USA. If you are a resident of the United States, you are prohibited from using the services of InstaFintech Group including online trading, online transfers, deposit/withdrawal of funds, etc.

If you think you are seeing this message by mistake and your location is not the US, kindly proceed to the website. Otherwise, you must leave the website in order to comply with government restrictions.

Why does your IP address show your location as the USA?

  • - you are using a VPN provided by a hosting company based in the United States;
  • - your IP does not have proper WHOIS records;
  • - an error occurred in the WHOIS geolocation database.

Please confirm whether you are a US resident or not by clicking the relevant button below. If you choose the wrong option, being a US resident, you will not be able to open an account with InstaForex anyway.

We are sorry for any inconvenience caused by this message.