July 29, 2025

USDCAD open 1.3752, overnight range 1.3731-1.3779 close 1.3740

USDCAD gained on the back of broad US dollar demand following the news of the EU/US trade deal which appears to be one-sided in favour of America. Part of the reason may be that Canada could suffer the same fate as politicians have yet to reach a tariff agreement with the US

The Bank of Canada is expected to leave interest rates unchanged at tomorrows meeting which also includes the quarterly Monetary Policy Report

WTI oil rose from 66.53 to 67.27 before dropping to 66.66 in NY. Prices are underpinned by hopes that removing the uncertainty around tariffs will lead to higher crude demand.

USDCAD will continue to track broad US dollar moves and if today’s US Consumer Confidence and JOLTS support a Fed rate cut, prices could fall.

USDCAD Technical Outlook:

The intraday technicals are bullish above 1.3710 and are looking for a decisive break above the 1.3760 area to extend gains to 1.3800. A move below 1.3710 negates the uptrend and suggests a retest of support at

The longer term outlook is unchanged- the USDCAD downtrend from March remains intact while prices are below 1.3820 and targeting 1.3560. A topside break targets 1.3950.

For today, USDCAD support is 1.3710 and 1.3670. Resistance is 1.3770 and 1.3800. Today’s Range: 1.3710-1.3800.

“Quelle horreur !”

To say French officials were unhappy with EU President Ursula von der Leyen’s tariff deal with Trump is an understatement. French Prime Minister Francois Bayrou tweeted, “It is a dark day when an alliance of free peoples, brought together to affirm their common values and to defend their common interests, resigns itself to submission.”

German Chancellor Friedrich Merz was a tad more subtle, claiming that US and EU economics would be negatively impacted. But he also said the EU “couldn’t expect to achieve any more.”

The real reason that the EU caved to Trump’s demands was simply security. Europe needs America’s military muscle in the face of Russian aggression.

China Tariff Delay
China’s Xi Jinping is one world leader who has refused to bow to Trump. He knows that both countries’ economies would be severely damaged by a trade war, but only Trump answers to voters. Trump knows that too, which is why he took exception to reports that he is seeking a meeting with Xi Jinping, despite the fact that he is. He tweeted on his TruthSocial account:
“The Fake News is reporting that I am SEEKING a ‘Summit’ with President Xi of China. This is not correct, I am not SEEKING anything! I may go to China, but it would only be at the invitation of President Xi, which has been extended. Otherwise, no interest! Thank you for your attention to this matter.”

Trade, Confidence and Jobs
The US trade deficit surprised analysts and narrowed to $85.9 billion from $97.5 billion in June and beat the forecast of -$98.4 billion. The Case-Shiller Home Price Index is expected at 3.0% (3.4% in May). The JOLTS job openings survey is forecast at 7.55 million, down from 7.769 million. Consumer Confidence is also on tap.

Taking Stock
Asian equity indexes closed mixed to lower, with Japan’s Topix losing 0.79%, Hong Kong’s Hang Seng down 0.15%, and Australia’s ASX 200 flat.

European equity traders like that tariff uncertainty has been removed, and stocks are up across the board. The French CAC-40 leads the charge and is up 1.19%, followed by the German DAX with a 1.10% gain and a 0.55% rise in the UK FTSE 100., all of which are below their peak session levels. S&P 500 futures are up 0.21%.

The US dollar index (DXY) climbed from 98.63 to 99.05 in NY while Gold (XAUUSD) is 3319.73, and the US 10-year Treasury yield is 4.377% as of 5:45 am PDT.

EURUSD
EURUSD dropped from 1.1599 to 1.1528 in early European trading but rebounded to 1.1580 in NY. Traders are rather unhappy with the EU/US trade deal, and the sell-off broke the uptrend line from the beginning of February. The breach of support at 1.1640 has set the stage for deeper losses to 1.1450.

GBPUSD
GBPUSD mirrored EURUSD moves and traded in a 1.3316-1.3362 range. The overnight session was fairly subdued ahead of today’s US data and a lack of market-moving UK reports. The BRC Shop Price Index rose 0.7% y/y in July, more than the expected 0.2% gain.

USDJPY
USDJPY consolidated recent gains in a 148.16-148.74 range as traders deal with the implications of various US tariff deals and Japanese political uncertainty ahead of Fed and Bank of Japan meetings, Wednesday and Thursday, respectively.

AUDUSD
AUDUSD traded lower in a 0.6499-0.6531 range due to broad US dollar strength in the wake of the US/EU trade deal, which is viewed as a big win for Trump. Traders were cautious ahead of tomorrow’s Australian inflation report.

USDMXN
USDMXN rallied in a 18.7434-18.8370 range and has recouped two weeks of losses since yesterday. The surge in US dollar demand following the US/EU trade deal and caution ahead of tomorrow’s FOMC meeting has fueled the gains.

USDCNY
PBoC fix: 7.1511 vs exp. 7.1891 (Prev. 7.1467).
Shanghai Shenzhen 300 rose 0.39% to 4152.02.

US Treasury Secretary Scott Bessent is leading the negotiation team meeting in China to hash out a tariff deal ahead of Trump’s August 12 deadline. Odds are that it will be extended by 90 days because the US desperately needs Chinese rare-earth minerals, among other things.

FX High, Low, Open

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