News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.



Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events


Economic Calendar

Economic Calendar Events

Free Trading Guides
Please try again
Oil - US Crude
Wall Street
More View more
Real Time News
  • Heads Up:🇺🇸 NAHB Housing Market Index (JAN) due at 15:00 GMT (15min) Expected: 86 Previous: 86
  • Heads Up:🇨🇦 BoC Monetary Policy Report due at 15:00 GMT (15min)
  • Heads Up:🇨🇦 BoC Interest Rate Decision due at 15:00 GMT (15min) Expected: 0.25% Previous: 0.25%
  • $EURGBP dropped from 0.8890 to below 0.8860 this morning, pushing to its lowest level since May. $EUR $GBP
  • Indices Update: As of 14:00, these are your best and worst performers based on the London trading schedule: Germany 30: 0.74% US 500: 0.66% France 40: 0.47% Wall Street: 0.36% FTSE 100: 0.26% View the performance of all markets via
  • The @bankofcanada is widely expected to stand pat on monetary policy with the overnight rate to remain at 0.25% alongside no change in the current pace (CAD 4bn/week) or composition of QE purchase. Get your market update from @JMcQueenFX here:
  • Reports of an explosion heard in Madrid - La Sexta TV Station
  • #Gold dropped quickly this morning, falling from $1,850 to below $1,835 before bouncing back. The precious metal is now trading around $1,850 again. $XAU $GLD
  • $EURGBP at risk of extended losses after breaking to the downside of a 12-month Symmetrical Triangle pattern and slashing through the support range at 0.8865 - 0.8875 A push towards 0.8670 - 0.8690 looks on the cards if sellers hurdle psychological support at 0.8800 $EUR $GBP
  • *Slight move higher in USDCAD
USDCAD Breakout Stalls Ahead of US NFP Report as GDP Fails to Impress

USDCAD Breakout Stalls Ahead of US NFP Report as GDP Fails to Impress

David Song, Strategist

Canadian Dollar Talking Points

The near-term breakout in USD/CAD appears to have stalled ahead of the 2018-high (1.3665) as the updates to the U.S. Gross Domestic Product (GDP) report point to slowing inflation, and the exchange rate may continue to consolidate ahead of the highly anticipated Non-Farm Payrolls (NFP) report as it snaps the series of higher highs & lows from earlier this week.

Image of daily change for major currencies

USDCAD Breakout Stalls Ahead of US NFP Report as GDP Fails to Impress

Image of daily change for usdcad rate

USD/CAD pares the advance following the Bank of Canada (BoC) meeting even though the U.S. economy expands 3.2% during the first three-months of 2019 as the core Personal Consumption Expenditure (PCE), the Federal Reserve’s preferred gauge for inflation, narrows to 1.3% from 1.7% per annuum in the fourth-quarter of 2018.

The GDP report indicates there’s little to no risk of an imminent recession as economic activity picks up from the 2.2% rate of growth during the last three-months of 2018, but signs of slowing inflation may push the Federal Open Market Committee (FOMC) to adopt a more accommodative stance as the central bank plans to winddown the $50B/month in quantitative tightening (QT) over the coming months.

Image of fed fund futures

In fact, Fed Fund Futures now reflect a greater than 60% probability for a rate-cut in December as the FOMC struggles to achieve the 2% target for inflation, and it remains to be seen if Chairman Jerome Powell & Co. will continue to project a longer-run interest rate of 2.50% to 2.75% as the central bank pledges to be ‘data dependent.’ As a result, market participants may pay increased attention to the NFP report as the FOMC is widely anticipated to retain the current policy on May 1, and the fresh update may instill an improved outlook for the region as the U.S. economy is projected to add another 181K in April, with Average Hourly Earnings expected to increase to 3.3% from 3.2% the month prior.

The lack of urgency to alter the forward-guidance may keep the U.S. dollar afloat as some Fed officials insist that ‘if the economy evolved as they currently expected, with economic growth above its longer-run trend rate, they would likely judge it appropriate to raise the target range for the federal funds rate modestly later this year, but the USD/CAD breakout following the BoC meeting appears to have stalled going into the weekend, with the exchange rate at risk for a larger pullback as it snaps the series of higher highs & lows from earlier this week.

Keep in mind, the near-term outlook for USD/CAD remains constructive as the exchange rate clears the range-bound price action from March, with the Relative Strength Index (RSI) highlighting a similar dynamic as the oscillator takes out the bearish formation from a similar timeframe.

Sign up and join DailyFX Currency Analyst David Song LIVE for an opportunity to discuss potential trade setups.

USD/CAD Rate Daily Chart

Image of usdcad daily chart
  • USD/CAD may stage a larger pullback following the failed attempt to test the 1.3540 (23.6% retracement) region, with the former-resistance zone around 1.3420 (78.6% retracement) to 1.3460 (61.8% retracement) back on the radar as the exchange rate searches for support.
  • Nevertheless, the string of failed attempts to close below the 1.3290 (61.8% expansion) to 1.3310 (50% retracement) region instills a constructive outlook for USD/CAD, with the key resistance zone coming in around 1.3630 (38.2% retracement) to 1.3660 (78.6% expansion), which lines up with the 2019-high (1.3665).
  • Will keep a close eye on the RSI as it continues to track the upward trend from earlier this year.

Additional Trading Resources

Are you looking to improve your trading approach? Review the ‘Traits of a Successful Trader’ series on how to effectively use leverage along with other best practices that any trader can follow.

Want to know what other currency pairs the DailyFX team is watching? Download and review the Top Trading Opportunities for 2019.

--- Written by David Song, Currency Analyst

Follow me on Twitter at @DavidJSong.

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.