USDCAD is currently trading at 1.37000. An unexpectedly weak labor market report from Canada has been the standout driver for the pair over the past week. April saw a net loss of 17,700 jobs—a sharp departure from expected growth—while the unemployment rate jumped to 6.9%, hitting a six-month high.
These figures have only solidified the view that the Bank of Canada (BoC) will stay cautious on monetary policy, prioritizing economic support over any hawkish shifts. Following its latest meeting, the regulator's interest rate remains frozen at 2.25%, and markets are pricing in no dramatic moves in the months ahead. Meanwhile, the Federal Reserve (Fed) sits at 3.75%, offering a tidy window for carry trades and throwing extra weight behind the US dollar.
Add geopolitical fog to the mix, and the greenback gets another leg up. The American currency is a classic safe‑haven play, though occasional signals that tensions might ease—particularly talks of reopening the Strait of Hormuz to oil traffic—tend to spark short-lived pullbacks. And those dips? They are shaping up to be attractive entry points for USDCAD.
On the technical side, this is exactly the story the charts are telling. The pair came under significant pressure in the second half of April, but it has since started to regain lost ground and edge higher—setting up what looks like a solid investment opportunity.
The final recommendation:
— Buy USDCAD at the current price, aiming for 1.38800 within one month.
— To shield ourselves from adverse market movements, place a Stop Loss order just beneath the support level, i.e., at 1.35500.
This content is for informational purposes only and is not intended to be investing advice.
