USD/CAD retreats as the US economy cools down

USD/CAD fell to 1.3530, tallying losses for the second day.
Investors dumped the USD as its economy showed signs of cooling down.
A hike by the Fed remains on the table, but rate cuts are seen sooner.

Patricio Martín FXStreet

In the middle of the week, the USD was one of the worst performers in the FX markets, driven by soft ADP Employment figures and downward revisions of the Gross Domestic Product (GDP) annualised rate. On the CAD’s side, no relevant data was released as investors' eyes are on Friday’s Q2 GDP figures revisions from Canada.

The GDP annualised growth rates figures from the United States was revised lower to 2.1%, while the ADP Employment Change figures missed the consensus in August. They showed that the US economy added 177,000 figures, lower than the 195,000 expected and the previous 371,000. The cooling economy evidence remained investors that Jerome Powell stated last Friday that the Federal Reserve (Fed) would maintain its policy at restrictive levels if the economy didn’t cool down.

According to the CME FedWatch tool, markets are now pricing in that the Federal Reserve will cut rates in June 2024 sooner than the previous expectations, while the odds of a hike in November remain near 40%. For the rest of the week, investors will eye Personal Consumption Expenditures (PCE) figures from July on Thursday and Friday’s Nonfarm Payrolls from August.

USD/CAD Levels to watch

The daily chart analysis indicates a neutral to a bearish outlook for USD/CAD, as the bears show signs of taking control but still face challenges ahead. The Relative Strength Index (RSI) points downwards in the bullish territory, suggesting a possible trend reversal, while the Moving Average Convergence (MACD) shows weaker green bars. However, the pair is above the 20,100,200-day Simple Moving Average (SMA), pointing towards the prevailing strength of the bulls in the larger context.

Support levels: 1.3495 (20-day SMA), 1.3460 (200-day SMA), 1.3450.

Resistance levels: 1.3575, 1.3590, 1.3600.

USD/CAD Daily Chart

USD/CAD

Overview
Today last price	1.3532
Today Daily Change	-0.0020
Today Daily Change %	-0.15
Today daily open	1.3552

Trends
Daily SMA20	1.3486
Daily SMA50	1.3323
Daily SMA100	1.3391
Daily SMA200	1.3461

Levels
Previous Daily High	1.3637
Previous Daily Low	1.355
Previous Weekly High	1.364
Previous Weekly Low	1.3496
Previous Monthly High	1.3387
Previous Monthly Low	1.3093
Daily Fibonacci 38.2%	1.3583
Daily Fibonacci 61.8%	1.3604
Daily Pivot Point S1	1.3522
Daily Pivot Point S2	1.3493
Daily Pivot Point S3	1.3435
Daily Pivot Point R1	1.361
Daily Pivot Point R2	1.3667
Daily Pivot Point R3	1.3697

Author

Patricio Martín

FXStreet

Patricio is an economist from Argentina passionate about global finance and understanding the daily movements of the markets.

AUD/USD remains above 0.7200 after China's trade data

AUD/USD sits above 0.7200 in the Asian session on Tuesday, near its highest level since May 14. The US Dollar stays under pressure as a rallying Japanese Yen outweighs support from hawkish Fed bets and geopolitical tensions. This, along with firming expectations for another RBA rate hike later this month, acts as a tailwind for the Aussie. However, mixed China trade balance data keep the pair restricted.

USD/JPY stabilizes at around 154.00 as markets assess BoJ outlook

USD/JPY fluctuates at around 154.00 in the American session on Tuesday after rebounding from the six-month low it touched below 153.00 earlier in the day. Nevertheless, the upside attempts resemble technical corrections for now as Japan's upbeat wage growth data and Q2 GDP revision cement bets on a BoJ rate hike next week and continue to support the Japanese Yen.

Gold holds around $4,400, but for how long?

Gold (XAU/USD) remains on the back foot during American trading hours on Tuesday, even as the US Dollar (USD) remains on the defensive. Rising Oil prices and expectations of a Federal Reserve (Fed) rate hike weigh on the precious metal. At the time of writing, XAU/USD trades around $4,400 after reaching an intraday high near $4,443.

Bitcoin remains highly sensitive to macro signals amid changing derivatives narrative

Bitcoin’s (BTC) sensitivity to US economic data has become increasingly evident this year. As the market approaches several important data dumps this week, BTC traders are keenly aware of the significance just like their counterparts in TradFi. And just like the stock market, crypto traders are focused squarely on the US central bank's interest rate policy.

Europe in focus: September 2026

Six major net contributors demanded substantial cuts to the European Commission’s proposed 2028–2034 EU budget. Germany, Denmark, the Netherlands, Austria, Finland and Sweden issued a joint position on 27 August calling for the nearly €2 trillion proposal to be reduced by several hundred billion euros and rejecting additional common EU borrowing.

Diesel’s record $100 warning: The oil shock hiding in plain sight

The Oil market may look calmer than it did a few months ago, but diesel is sending a very different message. The US diesel crack spread, the premium of ultra-low sulphur diesel futures over WTI, recently surged above $100 per barrel for the first time, reaching an intraday record of just over $102.00.