USD/CAD rises to highs since early July amid USD strength

USD/CAD rose near 1.3340, displaying more than 0.40% gains on the day.
ADP showed that the US created more jobs than expected in July.
Dropping Oil prices and a negative market sentiment also contribute to the upwards momentum.

Patricio Martín FXStreet

On Wednesday’s session, the USD/CAD rose for a second consecutive day, near 1.3340. A stronger Dollar amid hot labour market data from the US and lower Oil prices are the main responsible for the CAD’s weakness.

The US created more jobs than expected in July

The number of employed people in the US was 324,000 in July, according to Automatic Data Processing Inc. (ADP), which was higher than the 189,000 expectations but lower than the revised figure of 455,000 in June. Despite decelerating from its previous reading, it may suggest to the Federal Reserve (Fed) that the sector is still tight and may contribute to inflationary pressures via rising wages. That said, investors will closely look at Nonfarm Payrolls and Average Hourly Earnings data on Friday.

Reacting to the data, the USD strengthened as US yields rose and Wall St indexes dropped. The 2-year yield rose to 4.93% while the S&P 500 (SPX) declined by 1.23% as well as the Dow Jones and the Nasdaq Composite, which are seeing losses of 0.76% and 1.84%, respectively.

In that sense, investors may place bets on a more aggressive Fed. Still, as Chair Powell stated, monetary policy decisions will depend on data, so the labour market on Thursday and Friday will dictate the pace of the markets.

USD/CAD Levels to watch

From a technical standpoint, the USD/CAD maintains a bullish outlook for the short term, as observed on the daily chart. The Relative Strength Index (RSI) is comfortably positioned in the positive territory above its midline. It has a northward slope, complemented by a positive signal from the Moving Average Convergence Divergence (MACD), showing green bars, signalling a growing bullish momentum. Additionally, the pair is above the 20-day Simple Moving Average (SMA) but below the 100 and 200-day SMAs, suggesting that despite the recent bearish sentiment, the bulls are still resilient, holding some momentum.

Resistance levels: 1.3385 (July’s high), 1.3407 (100-day SMA), 1.3455 (200-day SMA).
Support levels: 1.3280, 1.3250, 1.3240.

Author

Patricio Martín

FXStreet

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

AUD/USD: The 0.7000 level holds the downside…for now

AUD/USD has clinched its fourth consecutive daily pullback on Thursday, coming closer to the key 0.7000 region while breaking below the critical 200-day SMA at the same time. The Aussie’s decline comes on the back of further gains in the Greenback in a context of rising yields and Fed rate hike bets.

USD/JPY keeps the red near 158.00 as Japanese Yen firms up

USD/JPY retreats from three-week highs and holds losses near 158.00 in the Asian session on Thursday. Surging Japanese bond yields lift the Yen amid looming intervention risks, while the US Dollar preserves overnight gains to a two-month high amid hawkish Fed bets and elevated US bond yields.

Gold bounces off lows, still below $4,300

Gold builds on Wednesday’s retracement, briefly slipping back below $4,250 per troy ounce to attempt a lacklustre rebound afterwards. The better tone in the US Dollar, rising US Treasury yields and expectation of extra rate hikes by the Fed continue to weigh on the precious metal in the latter part of Thursday’s NA session.

XRP is flashing three bullish signals heading into a historically weak October

XRP (XRP) is still flashing 3 bullish signals across its holders, derivatives, and ETF data. These signals come as the token gave back part of its September gains on Thursday. The token traded near $1.50 at press time, down about 6.3% over 24 hours, according to BeInCrypto Markets data. The pullback still leaves XRP up over 15.6% on the week, a gain that tracks a broader market rally.

Advanced economies: From one example of resilience to another

History tends to repeat itself in advanced economies. Once again, growth ultimately fell short of expectations by only a small margin in the first half of 2026, despite the conflict in Iran. As early as 2025, the impact of tariffs was less severe than feared.

BoJ Recap: Not as hawkish as expected

The Bank of Japan (BoJ) raised its short-term interest-rate target to 1.25% from 1.00% in a 7-2 vote, marking another step in the normalisation of monetary policy and widely matching what everyone has been expecting for weeks.