August 8, 2025
USDCAD open 1.3720, overnight range 1.3728-1.3762, close 1.3746
USDCAD traded sideways inside yesterday’s range but with a bearish bias due to rising odds for deeper and faster US rate cuts. Trump’s nomination of uber-dove Stephen Miran to replace Adriana Kugler who resigned last week will add another voice advocating rate cuts. In addition, the press has decided that Governor Chrisopher Waller’s audition to replace Fed Chair Powell was successful.
Canada lost 40,800 jobs in July, well below June’s gain of 83,100 and below the forecast of 13,500. The unemployment rate remained unchanged. One significant fact about the weakness of the Canadian job market is that according to Statistics Canada, “Of the 1.6 million people who were unemployed in July, 23.8% were in long-term unemployment, meaning they had been continuously searching for work for 27 weeks or more. This was the highest share of long-term unemployment since February 1998 (excluding 2020 and 2021).”
USDCAD rose to 1.3762 from 1.3744 pre-data.
WTI oil traded in a 63.20-64.46 and is near the top of that band in NY. The promised of tariffs on countries importing Russian crude is underpinning prices although there are reports China may be taking Indian cargos. Trump is finding it difficult to bully Xi Jinping.
USDCAD Technical Outlook:
The intraday technicals are unchanged from yesterday. They are bearish below 1.3750 and looking to break support at 1.3710 to extend losses to 1.3670. A move above 1.3750 negates the downside risk.
Longer term, USDCAD technicals bearish while trading below the 100-day moving average at 1.3835 which guards the downtrend line from February which comes into play at 1.3880. The RSI is trending lower, but ADX shows a lack of conviction. A decisive breach of 1.3640 targets 1.3600 while a break above 1.3835 shifts the focus to 1.4000.
For today, USDCAD support is 1.3710 and 1.3680. Resistance is 1.3750 and 1.3790. Today’s Range: 1.3710-1.3790
A Weasel in the Fed House
President Trump said he would nominate Stephen Miran to be a temporary replacement (term ends January 2026) for Governor Adriana Kugler who resigned last week. Mr. Miran, the current Chair of the White House Council of Economic Advisers, is widely viewed as the architect of Trump’s tariff strategy. It is Miran’s idea to use tariffs as a strategic tool to generate revenue, create leverage in negotiations, and compel countries to “pay their fair share” for the benefits of the U.S. security umbrella and financial system.
Mr. Miran is “Trump’s boy,” and it is almost a certainty that he will be urging aggressive Fed rate cuts.
Beating with a Tariff Stick
Trump decided that India will pay a 50% tariff beginning August 27 because they are buying sanctioned Russian oil. China, a much larger purchaser of Russian crude, is given a pass. That’s what cornering the market on rare earth minerals does for you.
Apple’s Tim Cook is concerned. He has plans to ship about 50% of Indian-produced iPhones to America, and although Trump has exempted iPhones from tariffs, that could change in a tweet.
Gold Aglow
Gold (XAUUSD) traders have their eyes on 3500, which has become more of a reality today. A Financial Times article claims the U.S. is planning tariffs on 1-kilo and 100-ounce gold bars, citing a Customs Border Protection agency letter dated July 31. Switzerland exported $61.5 billion to the U.S. in the 12 months ending in June.
Taking Stock
Asian equity indexes closed on a mixed note. Japan’s Topix climbed 1.21% while Australia’s ASX 200 fell 0.27%. European bourses traded in similar fashion. The French CAC 40 index is up 0.18% while the German DAX is down 0.24% and the UK FTSE 100 is flat. S&P 500 futures are up 0.29%. The U.S. dollar index (DXY) is 98.23, little changed from yesterday’s open.
EURUSD
EURUSD is near the bottom of its 1.1630–1.1679 range due to caution ahead of Trump/Putin talks next week and a lack of actionable Eurozone data. The odds of Putin agreeing to Trump’s ceasefire demand are slim to none unless Putin is awarded the territory he seeks. EURUSD technicals are bullish above 1.1600 and looking to break above resistance at 1.1720.
GBPUSD
GBPUSD traded in a 1.3425–1.3453 range, and it is not really worse for wear after the Bank of England (BoE) decision to cut rates by 25 bps. The decision was universally expected, but with more policymakers voting to leave rates unchanged, the statement was considered hawkish. GBPUSD technicals are bullish above 1.3360 and looking to break resistance at 1.3460 to target 1.3550.
USDJPY
USDJPY caught a bid and is at the top of its 146.72–147.81 range in NY. The BoJ Summary of Minutes from the July 31 meeting debated the need for rate hikes, with one member suggesting a hike before year-end. Traders did not care. On the trade front, the U.S. admitted an error after they implemented the new 15% tariff on top of existing tariffs. Washington promised to remove these “stacked tariffs” and refund overcharges.
AUDUSD
AUDUSD rallied to 0.6535 from 0.6512 on improved risk sentiment and the prospect of U.S. rates falling faster and further than previously anticipated. Traders are also waiting for the RBA rate decision on Tuesday when a 25 bp rate cut to 3.60% is expected.
USDMXN
USDMXN traded quietly in an 18.5873–18.6373 range after cutting interest rates to 7.75% from 8.00%, as expected. Deputy Governor Jonathan Heath wanted rates to remain unchanged. The statement tweaked the language, and the reference to further rate cuts was vague.
USDCNY
PBoC fix: 7.1382 vs exp. 7.1742(Prev. 7.1345)
The Shanghai Shenzhen CSI 300 fell 0.24% to 4104.97
FX High, Low, Open
Sources: Investing.com, Bloomberg, Reuters, Yahoo Finance, US Census Bureau, Trading Economics
