February 4, 2026

USDCAD open: 1.3664, overnight range 1.3629-1.3674, close 1.3642

USD/CAD traded sideways in Asia and Europe and then popped to its session peak in early NY trading however, the down trend line from mid-January, which is in the 1.3670-80 area, should limit gains.

There are no domestic issues or economic data which leaves Canadian dollar direction at the mercy of broad US dollar sentiment. Wall Street is still digesting the fall-out from the launch of Anthropic’s latest batch of AI productivity tools which many believe will have a negative impact on software and data services companies like Thomson Reuters and Intuit.

WTI oil prices spiked to 64.19 from 61.09 yesterday after the US Navy shot down an Iranian drone approaching an aircraft carrier. Traders fear that the already poor Iran/US relationship is about to go pear shaped. Military action against Iran could result in the closure of the Strait of Hormuz and choke off around 20 million barrels/day.

USDCAD Technical Outlook

The intraday USDCAD technicals are neutral-to-bullish while prices are above 1.3640, with a break of 1.3680, then 1.3705 targeting 1.3750. A move below 1.3640 would suggests a retest of 1.3610 and signal fading upside momentum.

The medium-term technicals suggest the rebound from 1.3350 is corrective rather than trend-changing while prices remain capped below 1.3800. However, failure to break below 1.3600 keeps upside risks alive and would put 1.3800 back in play.

For today, USDCAD support is at 1.3640 and 1.3610. Resistance is at 1.3680 and 1.3750.
Today’s Range: 1.3640–1.3740

Risk Sentiment Sours.

Anthropic’s announcement of new research tools, and a report that a US Navy fighter shot down an Iranian drone approaching the USS Abraham Lincoln, roiled equity markets, boosted the US dollar, oil, and gold (XAUUSD) yesterday. The markets are giving back some of the losses today except for XAUUSD, which extended its gains, rising to 5092.31 from 4910.35.

US Data in Focus

ADP employment rose just 22,000 which is 19,000 less than in December and well-below the forecast of 48,000. in the spotlight. The US dollar inched lower on the news. Later this morning, ISM Services is due, and expected to dip to 53.5 from 54.4.

Trump signed the bill to end the government shutdown, but it is too late for the Bureau of Labor Statistics, which will delay the release of the nonfarm payrolls report that was scheduled for Friday.

Taking Stock

Asian equity services ignored the Wall Street sell-off, and the major indexes rose. Australia’s ASX 200 added 0.80%, Japan’s Topix climbed 0.27%, and Hong Kong’s Hang Seng was flat.

As of 5:20 am PT, European bourses are higher except for the German DAX, which is down 0.31%. The French CAC-40 has gained 0.88%, and the UK FTSE 100 is up 1.16%. S&P 500 futures are up 0.08%, the US Dollar Index is at 97.48, the 10-year Treasury yield is 4.267%, and gold (XAUUSD) is at 5046.43

EURUSD

EURUSD see-sawed in a 1.1805–1.1839 range, dipping to its session low in early NY trading. Traders are awaiting today’s US data, which, if it comes in as weak as expected, could drive EURUSD towards 1.1900. However, caution ahead of Thursday’s ECB meeting, due to chatter that policymakers may voice concern about the strength of the euro, will temper gains. Eurozone HICP rose 2.0% m/m in January but fell 0.2% from 1.9% to 1.7% y/y. German composite PMI was 52.1 (forecast 52.5), and Services PMI slipped to 52.4 from 53.3.

GBPUSD

GBPUSD traded in a 1.3691–1.3733 band and remains in an intraday uptrend while prices are above 1.3670. The Bank of England is expected to leave its benchmark rate unchanged tomorrow due to recent stronger-than-expected UK economic data.

USDJPY

USDJPY rallied from 155.70 to 156.86 and is at the top of that band in NY. The gains were fueled by expectations that Prime Minister Sane Takaichi’s government will win a large majority, which opens the door to her fiscal stimulus plans.

AUDUSD

AUDUSD remained steady in a 0.7010–0.7044 range as it held on to most of its post-RBA rate hike gains. Prices were supported by Chinese PMI data and the rebound in commodity prices.

USDMXN

USDMXN bounced in a 17.2060–17.2821 range as global risk aversion eased somewhat. Expectations for a weak US ADP report and a bearish USDMXN bias due to MXN/US interest rate differentials will limit gains.

China

PBoC Fix: 6.9533 vs (Prev. 6.9608)

Shanghai Shenzhen CSI 300 rose 0.83% to 46988.68

RatingDog Services PMI 52.3, vs 52.0 in December, Composite PMI 51.6 vs 51.3 in December.

President XI Jinping spoke to Putin today and said that relations between the two countries are on the right trajectory. Some analysts are speculating that Trump’s hostility towards Greenland and Iran are helping to improve China/Russian relations.

FX  open high low

FX Heat Map (6:00 am) one week

Sources: Investing.com, Bloomberg, Reuters, Yahoo Finance, US Census Bureau, Trading Economics Tradingview