The USDCAD rate reversed downwards and consolidated below 1.3800 following the release of weak US Nonfarm Payrolls data on Friday. Discover more in our analysis for 4 August 2025.
USDCAD forecast: key trading points
- Market focus: Nonfarm Payrolls rose by only 73 thousand in July, significantly below expectations
- Current trend: moving downwards
- USDCAD forecast for 4 August 2025: 1.3800 or 1.3700
Fundamental analysis
The Canadian dollar strengthened after the release of US employment data. The July Nonfarm Payrolls report disappointed the market as only 73 thousand jobs were created, and previous months’ data were significantly revised downwards, worsening the outlook for US economic growth.
At the same time, the Canadian economy showed some resilience: a 0.1% GDP contraction in May was followed by a 0.1% rebound in June, alongside a 0.7% increase in manufacturing output. This supported the Bank of Canada’s decision to hold its key interest rate steady at 2.75%, which contrasts with the Federal Reserve’s dovish stance.
USDCAD technical analysis
On the H4 chart, the USDCAD pair is reversing down from the local daily high of 1.3880. The Alligator indicator is attempting to turn downwards, indicating a high probability of a continued downward movement.
The short-term USDCAD forecast suggests a further decline if the bears keep the price below 1.3800. However, if the bulls regain control and push the pair back above 1.3800, growth towards the daily high of 1.3880 may follow.
Summary
The USDCAD pair reversed lower and dropped below 1.3800, as the US dollar came under pressure following the release of weak Nonfarm Payrolls data.
Source: Roboforex
