empty
10.01.2025 01:00 PM
USD/CAD: Analysis and Forecast

This image is no longer relevant

Today, the USD/CAD pair continues its upward trend for the fourth consecutive day, driven by sustained demand for the US dollar.

The US Dollar Index, which tracks the dollar against a basket of currencies, is approaching a two-year high, supported by hawkish signals from the Federal Reserve. Minutes from the December FOMC meeting indicate a slowdown in the pace of rate cuts, which further supports the dollar.

Additionally, speculation about expansionary policies under US President-elect Donald Trump, potentially driving inflation higher, keeps US Treasury yields elevated, acting as a tailwind for the dollar.

This image is no longer relevant

Geopolitical instability caused by the conflict between Russia and Ukraine, as well as changing dynamics in the Middle East and fears of a trade war, continues to bolster demand for safe-haven assets like the US dollar. At the same time, Trump's tariff threats add uncertainty to Canada's economic outlook, negatively impacting the Canadian dollar.

Markets anticipate that the Bank of Canada will lower interest rates by 25 basis points in January, further undermining the Canadian currency. Despite rising oil prices, which typically support the Canadian dollar, traders remain cautious, maintaining an upward bias in USD/CAD.

This image is no longer relevant

Traders and investors are advised to avoid aggressive directional bets ahead of the release of key monthly employment data for the US and Canada, set to be published later today during the early North American session.

Preliminary expectations suggest that the US economy added 160,000 jobs in December, with the unemployment rate holding steady at 4.2%. In Canada, employment is forecasted to increase by 25,000, with the unemployment rate likely rising to 6.9%. Deviations from these projections could trigger market volatility, creating short-term trading opportunities in the USD/CAD pair.

From a technical point of view, the next move higher will encounter resistance near the supply zone at 1.4422–1.4430, beyond which USD/CAD could attempt to retest the multi-year high of 1.4465, reached in December. Given that daily chart oscillators remain comfortably in positive territory and far from overbought levels, further buying may pave the way for a move toward the psychological level of 1.4500.

From a technical point of view, a corrective pullback may attract buyers around the 1.4350–1.4345 level, limiting declines near the round figure of 1.4300, followed by the weekly low at 1.4275. Further selling pressure could tilt the bias in favor of bears, exposing USD/CAD to an accelerated decline toward the key support level at 1.4200.

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

AUD/USD: Analysis and Forecast

The AUD/USD pair continues its sideways consolidation, remaining within a familiar range near the key psychological level of 0.6300. This movement is driven by several factors impacting global market sentiment

Irina Yanina 11:16 2025-03-28 UTC+2

EUR/USD. Analysis and Forecast

Today, the EUR/USD pair is consolidating near the key psychological level of 1.0800, showing no intention of retreating below 1.0780 as traders and investors await the release of the U.S

Irina Yanina 10:45 2025-03-28 UTC+2

Markets at a Crossroads Ahead of Tariff Announcement by D. Trump (Possible Decline in CFD Contracts on #SPX and #NDX Futures)

Markets are now fully convinced that the U.S. President will follow through on his plans to implement severe customs tariffs aimed at closing the domestic market and, in doing

Pati Gani 10:39 2025-03-28 UTC+2

Markets Have Found the Culprits

If you don't get it the first time, you will the second. The S&P 500 sell-off, led by U.S. and foreign automaker shares, continued a second day after the imposition

Marek Petkovich 08:19 2025-03-28 UTC+2

What to Pay Attention to on March 28? A Breakdown of Fundamental Events for Beginners

A fair number of macroeconomic events are scheduled for Friday, but we believe they will likely trigger only a localized market reaction. The UK will publish Q4 GDP data

Paolo Greco 06:26 2025-03-28 UTC+2

GBP/USD Pair Overview – March 28: The Pound Barely Fell Before Rising Again

The GBP/USD currency pair traded higher again on Thursday, even though a semblance of a downward correction had begun just a few days earlier. The market had already digested

Paolo Greco 03:00 2025-03-28 UTC+2

EUR/USD Pair Overview – March 28: Donald Trump Loves Surprises

The EUR/USD currency pair maintained its downward bias on Thursday, although it traded higher throughout the day. Volatility remained low once again, indicating weak market activity. However, traders had enough

Paolo Greco 03:00 2025-03-28 UTC+2

EUR/USD. Trump Sends the Dollar into Knockdown Again

The EUR/USD pair is experiencing a correction following Donald Trump's latest statements, as he has once again reignited the tariff war. Interestingly, the greenback initially reacted positively to the president's

Irina Manzenko 23:44 2025-03-27 UTC+2

Gold Knows the Path to Victory

Gold was not a market favorite following Donald Trump's victory in the November elections. In fact, it pulled back once the red wave became clear and the Republican's return

Marek Petkovich 10:55 2025-03-27 UTC+2

XAU/USD – Analysis and Forecast

Gold continues to hold its intraday gains, trading near the weekly high around the $3036 level. This is due to several factors, including uncertainty surrounding U.S. trade policy

Irina Yanina 10:44 2025-03-27 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.