The USDCAD currency pair fluctuated recently due to news about tariffs and unexpectedly strong Canadian job reports. Initially, the pair increased with the tariff announcements but then fell after the job data was released. During the Asian session, it settled at earlier lows before rising again. **Technical Overview** The USDCAD dropped below the 100-hour moving average at 1.3675 but found support near the day’s low. Following this dip, the pair bounced back, retesting the moving average, which led sellers to become buyers. A new support test on the 5-minute chart showed increased demand, boosting buyers’ confidence and starting a price rise. Now, the pair is back to the levels seen before the job data release, marking an important point. If it breaks through and stays above 1.3700, we may see further upward movement. The next key target is the 38.2% retracement from May’s high, located at 1.37208. Earlier today, the price briefly exceeded this retracement due to reports of a 35% Canadian tariff. If it can maintain a rise above 1.37208, this would create a positive outlook for USDCAD. **Market Reactions** We’ve observed a responsive interplay between economic data and political events. Initially, USDCAD rose after tariff headlines, leading to short-term buying interest. This reaction is common; news of potential trade barriers usually initially favors the US dollar as traders seek safety. However, this upward trend didn’t last long. The strength of the Canadian labor report completely reversed the momentum. Once the data revealed higher employment numbers than expected, demand for Canadian dollars surged, counteracting the earlier increase. From a technical standpoint, the currency dipped below a short-term moving average, which we often use to gauge short-term direction. This drop hit a nearby support level, allowing the pair to hover briefly before buyers took control. This shows traders’ readiness to build positions once a technical retest confirms existing demand, indicating bullish sentiment after some initial uncertainty. **Current Levels** The pair is now testing familiar territory—the levels seen before the employment report. This return suggests some hesitation, indicating a possible balance between buyers and sellers. However, if it can push above 1.3700 and maintain that level, it will provide further support for those betting on a rise. Staying strong above this mark signals that demand is robust. The 1.37208 level, marked by the retracement from May’s high, is the next hurdle. Earlier today, the price briefly moved past this area due to ongoing tariff news, but momentum waned. If buyers can keep the price above this level for several sessions, it will likely encourage more participation. It’s often more meaningful when the price remains above a retracement instead of just touching it. **Next Steps** Moving forward, we will focus on how the price behaves around 1.3720 and whether volume increases with upward movements. Pay attention to reactions near moving averages across shorter timeframes—these often effectively reflect short-term behavior during uncertain times. Watch for signs that support could turn into a foundation if we dip again. Sustained interest beyond technical resistance indicates stronger conviction among major players, especially after volatile sessions.

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