The USDCAD currency pair is currently experiencing a consolidation phase, trading at 2025 lows. This movement is primarily influenced by two key factors: the USMCA risk and the hot NFP report. The USMCA deal, which Canada has benefited from due to its low tariffs on US goods, is now under scrutiny as US President Trump considers quitting. This potential exit could significantly impact Canada's economy by increasing tariffs. On the other hand, the hot NFP report, which boosted the USD, has created a delicate balance in the market. The market is now eagerly awaiting the US CPI report, which could either reinforce the USD's strength or create a new dynamic. The technical analysis of USDCAD on the daily, 4-hour, and 1-hour timeframes reveals a complex trading scenario. While buyers are targeting a pullback into the major trendline, sellers are looking for a break below the recent low. The upcoming catalysts, including the US Jobless Claims figures and the US CPI report, will play a crucial role in determining the next move for this currency pair.
