Usdcad sees marginal drop amid mixed US economic signals in consolidation phase

USDCAD Analysis

Performance after Thursday
Period	Pct	Chg	Momentum
Thursday	-0.01%	-1.6 Pips
Week to-date	-0.72%	-99 Pips
July	-0.18%	-25 Pips

Upcoming key events (London Time)

No major events for the day.

What happened lately

In May 2025, the United States saw a significant increase in new orders for manufactured goods by 8.2% following a decline of 3.7% in April, as reported by the Census Bureau. Furthermore, the U.S. Nonfarm Payroll Employment rose by 147,000 in June, an improvement from the revised May figure of 139,000. Initial Unemployment Insurance Claims decreased slightly to 233,000 for the week ending June 28, demonstrating a resilient job market. However, the overall labor force participation rate dipped to 62.3% in June from 62.4% in May, indicating a slight contraction in the active workforce. The unemployment rate showed positive signs, falling from 4.2% in May to 4.1% in June. Despite this, average hourly earnings growth slowed; it recorded a monthly increase of just 0.2% in June compared to 0.4% in May, while the year-over-year rate declined to 3.7% from a revised 3.8%. Additionally, the broader U-6 measure of labor underutilization also decreased slightly to 7.7% from 7.8% the prior month, according to the Bureau of Labor Statistics.

The movements in the USDCAD reflect a marginal drop of 0.01%, closing at 1.35863, which indicates consolidation in the currency pair. The positive economic indicators such as the rise in manufacturing orders and the decrease in unemployment rate and claims help support the U.S. Dollar; however, the deceleration in average hourly earnings and slight contraction in the labor force participation may create mixed sentiment. As traders digest these mixed signals, the currency pair might experience limited volatility due to the absence of more impactful economic events for the day. This consolidation phase suggests that the market is waiting for more significant data or developments to dictate the next move in the exchange rate. Overall, the recent economic trends could stabilize the USD against the CAD in the short term but may need stronger future economic signals to fuel substantial movement in the exchange rate.

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What can we expect from USDCAD today?

USDCAD on Thursday dropped -0.01% to 1.35863. Price is below 9-Day EMA while Stochastic is falling in oversold zone.

Updated daily direction for USDCAD looks mixed as the pair is likely to consolidate above 1.35516 (S1).

Looking ahead today, to see upside interest, we prefer to look at price breakout of last daily high of 1.36239 or trades above daily pivot 1.35877. Break above could target R1 at 1.36225. While to the downside, we are looking at 1.35516 (S1) and daily low of 1.35530 as support levels. USDCAD need to break on either side to indicate a short-term bias. A close below 1.35530 would indicate selling pressure.

For the week to-date, take note that USDCAD is bearish as the pair posted lower by -0.72%.

Key levels to watch out:

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