USD/CAD Slips as Traders Digest Strong U.S. Jobs Report and Shift Focus to US-China Trade Talks in London

Economic

Summary:

USD/CAD retreats as markets digest robust U.S. payrolls and refocus on US-China trade negotiations, while Canadian jobless data triggers loonie softness.

SELL USDCAD

Close Time

CLOSED

1.36700

Entry Price

1.36000

1.37100

1.38080 -0.00067 -0.05%

42.3

Pips

Profit

1.36000

1.36277

Exit Price

1.36700

Entry Price

1.37100

The USD/CAD pair fell broadly on Monday, reversing some of Friday’s sharp post-payroll gains as investors reassessed the strength of the U.S. labour market and turned their attention to a renewed round of U.S.-China trade talks taking place in London. While the tone in global markets remains cautiously optimistic, traders appear to be rotating out of the U.S. Dollar following its recent rally, amid growing questions over the sustainability of economic strength and Federal Reserve policy direction.

After Friday’s blockbuster Nonfarm Payrolls (NFP) report propelled the greenback higher across the board, Monday's price action reflected a natural pause. Market participants are now looking for the next major catalyst, and the rekindled dialogue between the United States and China is taking center stage. Trade envoys from both nations are convening in London in a bid to revive the momentum established during last month’s Geneva summit, which resulted in a notable rollback of reciprocal tariffs and was hailed as a step toward de-escalation.

While headlines around trade have turned marginally positive, the broader mood remains cautious. The recent history of back-and-forth tariff policy and fragile trust has left traders wary. As such, any sign of friction could swiftly tilt sentiment, especially with the U.S. election cycle drawing closer and global supply chain vulnerabilities still top of mind.

The U.S. Dollar surged on Friday after the May NFP report showed a stronger-than-expected 139,000 jobs added, well above the 130,000 consensus forecast. While the data wasn’t explosive, it was sufficient to counteract the gloom from weaker ISM services and manufacturing figures earlier in the week, as well as a disappointing ADP report.

The Unemployment Rate held steady at 4.2%, while average hourly earnings remained firm with a 3.7% year-over-year increase. Together, the figures painted a picture of a labour market that, while slowing, remains resilient. Crucially, they aligned with the Federal Reserve’s messaging that no immediate rate cuts are on the horizon.

This data undermined rate cut bets, lifting short-term yields and boosting the dollar on Friday. But as the week begins, investors seem to be reassessing just how much runway the greenback has, especially in light of ongoing geopolitical and trade risks.

Across the border, Canada’s own labour market data painted a more complex picture. The economy added a net 8.8K jobs in May, following a 7.4K job loss in April, and handily beating expectations for a 15K drop. However, the surprise increase in employment was overshadowed by a disappointing uptick in the Unemployment Rate, which climbed to 7.0%—the highest since the height of the COVID-19 pandemic.

The rise in joblessness, despite the headline beat, reflects deeper structural challenges in the Canadian economy, including regional disparities in job creation and lingering weakness in sectors like manufacturing and energy. Unsurprisingly, the loonie gave back some gains after the data, with markets doubting whether this print was strong enough to change the Bank of Canada’s cautious stance.

Technical Analysis

Technically, USD/CAD remains capped below the 1.3690 resistance level—a critical ceiling the pair has failed to decisively break in recent sessions. The short-term trend remains bearish, underpinned by sustained pressure below the 50-day Exponential Moving Average (EMA), which continues to exert downward momentum.

Furthermore, the pair’s recent rejection near overbought levels on the Relative Strength Index (RSI) suggests waning bullish momentum. The presence of a minor descending trendline adds further downside pressure, with bears eyeing a potential test of support near 1.3600 if sentiment remains cautious and oil prices firm—often supportive of the Canadian Dollar.

TRADE RECOMMENDATION

SELL USDCAD

ENTRY PRICE: 1.3670

STOP LOSS: 1.3710

TAKE PROFIT: 1.3600

Risk Warnings and Disclaimers

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Eva Chen

Commodity

Economic

Summary:

Mixed fundamentals are driving wide fluctuations in gold prices. Given gold’s historically bearish performance in June, the short-term outlook remains neutral to bearish.

SELL XAUUSD

Close Time

CLOSED

3348.00

Entry Price

3215.00

3376.00

4211.49 +13.58 +0.32%

254.7

Pips

Profit

3215.00

3322.53

Exit Price

3348.00

Entry Price

3376.00

Fundamentals

Gold prices staged a modest rebound on Monday, paring losses from the near 2% sell-off over the previous two trading sessions.

Last week, gold’s rally lost momentum and reversed sharply after briefly testing the $3,400 level. A key factor behind the decline was the easing of U.S.-China trade tensions following the first phone call between their leaders.

However, deteriorating macroeconomic conditions failed to lift gold prices. A string of weak economic indicators last week pointed to a slowdown in U.S. economic growth, further strengthening expectations of over 50 basis points in Federal Reserve rate cuts.

Key data showed that U.S. nonfarm payrolls for May (seasonally adjusted) increased by 139,000—the lowest reading since February. While above the market forecast of 130,000, it fell significantly short of the average final value of 200,000. The early impacts of President Trump’s global trade war appear to be manifesting in the labor market, manufacturing, consumer spending, and the broader service sector.

The failure of these bearish macro signals to boost gold prices is likely due to technical reasons. Despite a previous breakout from a triangle consolidation and a developing inverse head-and-shoulders pattern, gold still failed to sustain its upward trajectory—something worth cautioning against.

Another critical observation: Over the past several years, gold prices have typically posted a bearish candlestick on the monthly chart in June. If this seasonal pattern persists, the recent strength in gold may be inconsistent with broader market behavior.

From a fundamental perspective, after months of declining inflation indicators, investors are hoping the Fed will not hesitate to cut rates should the economy falter. However, there are also arguments for maintaining the current policy stance, at least until after the July 9 reciprocal tariff deadline, by which time a clearer trade agreement might emerge.

Since inflation remains above the Fed’s 2% target, policymakers may be reluctant to lower borrowing costs prematurely—especially with the possibility of renewed trade tensions.

This Wednesday’s U.S. CPI report for May will test the rising optimism over potential rate cuts, as it may indicate whether the recent disinflationary trend has stalled. According to the Cleveland Fed’s Nowcast model, the headline CPI is expected to rise 2.4% YoY in May, up from April’s 2.3%, while the core CPI is forecast to remain steady at a 2.8% YoY pace.

Will Gold’s Historical Bearish Pattern in June Persist This Year?_1

Technical Analysis

After last week’s sharp retreat, gold started the week on a weak note, facing a third consecutive day of selling pressure following a false breakout above a bullish pennant pattern.

Momentum indicators suggest ongoing weakness. The stochastic oscillator is declining steeply but has yet to enter oversold territory, while the RSI remains slightly above the 50 mark. This neutral-to-bearish setup is clearly reflected in the price action.

In line with historical patterns, the strategy remains to sell on rallies.

Trade Recommendations

Trading Direction: Sell

Entry Price: 3348

Target Price: 3215

Stop Loss: 3376

Valid Until: June 24, 2025 23:55:00

Support: 3294/3272/3245

Resistance: 3333/3346/3350

Risk Warnings and Disclaimers

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Warren Takunda

Economic

Summary:

The British Pound rose modestly on Friday, supported by upbeat UK GDP data and dovish-leaning commentary from Bank of England’s Greene.

BUY GBPUSD

Close Time

CLOSED

1.35600

Entry Price

1.37000

1.35000

1.33169 -0.00143 -0.11%

60.0

Pips

Loss

1.35000

1.34998

Exit Price

1.35600

Entry Price

1.37000

The British Pound remained marginally higher against the US Dollar during Friday's North American session, as investors digested a confluence of economic and geopolitical developments that have the potential to recalibrate central bank expectations and currency flows in the coming weeks.

Sterling initially touched a session high of 1.3581 before retracing slightly to trade around 1.3532 by the New York close, registering a mild 0.05% gain on the day. The move reflected cautious optimism following a report by The Wall Street Journal indicating that US President Donald Trump is granting Treasury Secretary Scott Bessent the authority to adjust technology export controls imposed on China. The development hints at a possible thaw in the ongoing trade standoff between the world’s two largest economies, a key geopolitical risk that has weighed heavily on market sentiment in recent months.

On the domestic front, the Pound drew support from stronger-than-expected UK economic data. Preliminary estimates for first-quarter 2025 GDP came in above consensus, highlighting the UK economy's resilience in the face of tightening monetary conditions and sluggish global demand. The positive data suggests the British economy may be more robust than previously anticipated, offering the BoE some breathing room as it charts the course for future interest rate policy.

Adding to the bullish case for the Pound was commentary from BoE Monetary Policy Committee member Megan Greene. Speaking on Friday, Greene noted that the disinflation process in the UK is progressing, with inflation expected to trend toward the central bank's 2% target over the medium term. Her remarks—although measured—were interpreted by markets as an early sign that the BoE may not be far from a potential policy pivot, particularly if inflation continues to ease in line with projections.

Across the Atlantic, US non-farm payrolls surprised to the upside, with 139,000 jobs added in May—beating economist expectations of 130,000. The unemployment rate held steady at 4.2%, reinforcing the narrative of a labor market that remains sturdy despite persistent headwinds from high interest rates and elevated inflation. However, underlying softness in wage growth and hours worked continues to signal that the broader economy is decelerating, albeit gradually.

This data set, while stronger than forecast, is unlikely to dramatically shift the Federal Reserve’s cautious stance in the near term. Market participants continue to expect the Fed to hold rates steady at its upcoming meeting, with rate cuts potentially on the table later in 2025 should inflation ease further and growth slow meaningfully.

Arguably the most market-sensitive headline of the day came not from an economic release, but from the geopolitical arena. According to reporting by The Wall Street Journal, President Trump is offering Treasury Secretary Bessent increased discretion over the administration's export control policy, particularly with regard to tech sales to China. This could mark a significant softening of Washington’s stance on Beijing, potentially reducing the risk of further escalation in the trade conflict that has plagued global markets.

Investors interpreted the news as a sign that the Trump administration may be seeking a more pragmatic approach ahead of the 2025 presidential election cycle, especially given rising concerns about inflation and global supply chain fragility. Equity markets reacted with cautious optimism, although major US indexes still closed the day in negative territory, weighed down by lingering uncertainties.

Next week promises to be a critical one for Sterling traders. On the UK side, upcoming government spending plans, BRC Retail Sales Monitor, labor market data, and trade balance figures will provide fresh insight into the strength of the economic recovery. These prints could significantly influence the BoE’s tone in upcoming communications, particularly if data surprises again to the upside.

In the US, the focus shifts to inflation metrics, with May CPI and PPI due midweek. Also on the docket are jobless claims and the University of Michigan’s Consumer Sentiment survey, which could offer more color on consumer confidence heading into the summer.

Technical Analysis

From a technical perspective, GBP/USD is trading just below the key resistance zone around 1.3585. The pair has managed to find short-term support at the 50-day Exponential Moving Average (EMA), reinforcing the prevailing bullish trend structure. A developing positive divergence on the Relative Strength Index (RSI)—especially after entering oversold territory—indicates that momentum may be building for a potential upside breakout.

Should the pair breach 1.3585 with sustained buying volume, it could pave the way for a rally toward 1.3660 and possibly beyond. Conversely, a failure to hold above 1.3500 would raise the risk of a near-term retracement, particularly if US inflation data surprises to the upside and revives hawkish Fed bets.

TRADE RECOMMENDATION

BUY GBPUSD

ENTRY PRICE: 1.3560

STOP LOSS: 1.3500

TAKE PROFIT: 1.3700

Risk Warnings and Disclaimers

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Warren Takunda

Central Bank

Summary:

The New Zealand Dollar climbs to near year-to-date highs, fueled by optimism ahead of high-stakes US-China trade talks in London. The US Dollar softens as the post-payrolls rally fades despite strong labor data.

BUY NZDUSD

Close Time

CLOSED

0.60400

Entry Price

0.61500

0.60000

0.57781 +0.00027 +0.05%

16.4

Pips

Profit

0.60000

0.60564

Exit Price

0.60400

Entry Price

0.61500

The New Zealand Dollar surged on Monday, outperforming all major currencies as global risk sentiment improved ahead of a crucial meeting between US and Chinese trade officials in London. NZD/USD rose nearly 0.7% intraday, testing the 0.6080 level—its highest since the start of the year—as markets priced in growing optimism that the meeting could yield a breakthrough, or at the very least, a signal of renewed cooperation.

The rally in the Kiwi was mirrored by strength in other risk-sensitive currencies such as the Australian Dollar, both of which are widely seen as proxies for Chinese economic activity. Investor confidence was boosted by a weekend social media post from US President Donald Trump, who indicated progress in trade discussions, fueling hopes of easing tensions between the world's two largest economies.

The stakes are high for the talks in London, with markets increasingly attuned to any signals that could help clarify the path of global trade policy. A constructive outcome could not only support commodity-linked currencies but also inject fresh momentum into emerging markets and risk assets more broadly.

While risk currencies gained traction, the US Dollar pulled back after a brief rally on Friday that followed the release of stronger-than-expected labor market data. The Dollar Index (DXY) declined on Monday as investors began to shift their attention from domestic fundamentals to geopolitical developments.

Friday’s Nonfarm Payrolls report showed that the US economy added 139,000 jobs in May, beating the market consensus of 130,000. Average hourly earnings grew by 3.9% year-on-year, surpassing expectations of 3.7%, while the unemployment rate held steady at 4.2%. The report momentarily bolstered the greenback, reinforcing the Federal Reserve's hawkish stance and easing recession concerns.

However, despite the robust labor data, traders appeared reluctant to chase the Dollar higher. The retracement suggests markets are placing more weight on external risks, particularly the outcome of the US-China meeting and its implications for global growth and trade stability.

Technical Analysis

From a technical perspective, NZD/USD has entered a bullish phase, clearing the important resistance level at 0.6025. The pair remains supported by the 50-day Exponential Moving Average (EMA50), with momentum indicators pointing toward further gains. A developing bullish divergence in the Relative Strength Index (RSI), following a period of oversold conditions, further strengthens the case for a sustained upward move.

The price structure shows a potential inverse head-and-shoulders formation, which, while not textbook in shape, indicates the potential for a medium-term trend reversal. The upside target remains around the 0.6150 zone, provided that price action holds above the 0.6025 support and continues to benefit from improving sentiment.

As long as NZD/USD trades above the rising trendline on the daily chart, the bullish bias remains intact. A daily close above 0.6080 would likely accelerate the move toward the next key resistance at 0.6150, while a failure to hold current levels could see the pair retrace toward the 0.6000 handle.

TRADE RECOMMENDATION

BUY NZDUSD

ENTRY PRICE: 0.6040

STOP LOSS: 0.6000

TAKE PROFIT: 0.6150

Risk Warnings and Disclaimers

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Alan

Cryptocurrency

Summary:

Affected by profit-taking, Bitcoin has recently pulled back from $112,000 to a low of $100,400. It has since rebounded but remains below the $107,000 resistance level, with upward pressure intensifying in the short term.

SELL BTC-USDT

Close Time

CLOSED

105925.2

Entry Price

101000.0

109000.0

91846.0 +2291.2 +2.56%

3074.8

Pips

Loss

101000.0

109000.0

Exit Price

105925.2

Entry Price

109000.0

Fundamentals

On June 9th, Bitcoin held steady above $105,000, and the market closely monitors the impact of key U.S. economic data and global macro events this week.

On one hand, the U.S. is set to release May CPI data on Wednesday. If inflation rises unexpectedly, the Federal Reserve may delay interest rate cuts, keeping the U.S. dollar resilient and pressuring USD-priced-in Bitcoin.

On the other hand, high-level China-U.S. trade talks resumed on June 9th. Substantial progress in negotiations could boost risk assets, including Bitcoin.

Additionally, major financial institutions fail to provide substantial updates on the approval progress of Bitcoin ETFs. In the short term, institutional entry may continue to slow, with significant speculative profit-taking pressure.

Overall, a stronger U.S. dollar and regulatory uncertainty pose short-term headwinds, while China-U.S. trade talks and expectations for downstream ETFs are adding divergence to the market.

Technical Analysis

Rebound after Exhausted? Bears Eyeing the 100,000 Level_1

Based on the daily chart, Bitcoin came under pressure and pulled back after hitting a high of $112,000 at the end of May. It accelerated its decline to $100,400 on June 6th before quickly rebounding, indicating some support. Currently, Bitcoin rebounds but remains below the $107,000 resistance level. Consecutive bearish candles on the 4-hour chart suggest significant upward resistance at this level. If the weakening continues, Bitcoin may test the $100,400 support level downward in the short term.

Now, Bitcoin has encountered selling pressure during two consecutive rebounds near $107,000, failing to break through the resistance zone formed by the earlier decline. The likelihood of a short-term downward pullback is high, and the $105,000 level provides temporary support. If Bitcoin breaks below this level, it may test the $100,400 support level further.

Trading Recommendations

Trading direction: Sell

Entry price: 106000

Target price: 101000

Stop loss: 109000

Valid Until: June 23, 2025, 23:00:00

Support: 105000/100400

Resistance: 106804/108897

Risk Warnings and Disclaimers

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Eva Chen

Central Bank

Forex

Summary:

The euro has faced short-term pressure following the ECB's rate cut but has rebounded to a six-week high, supported by the hawkish stance and pause signals from the ECB meeting. In contrast, New Zealand's recent high interest rates, along with raw material exports and commodity prices, provide fundamental support for the New Zealand dollar (NZD). The New Zealand dollar remains relatively robust in the short term.

SELL EURNZD

Close Time

CLOSED

1.89162

Entry Price

1.81700

1.91250

2.01612 +0.00061 +0.03%

208.8

Pips

Loss

1.81700

1.91250

Exit Price

1.89162

Entry Price

1.91250

Fundamentals

The European Central Bank (ECB) cut the deposit rate by 25 basis points to 2.00%, as widely expected by the market. The ECB stated that this rate cut "comes with significant uncertainty" and remains committed to a data-dependent, meeting-by-meeting decision-making approach, thus not providing forward guidance on future rate movements.

In its latest economic projections, the ECB currently forecasts that the overall inflation rate will average 2.0% in 2025 and 1.6% in 2026, down 0.3 percentage points from the March forecast. The overall inflation rate is expected to return to the target level of 2.0% in 2027. This revision is primarily due to lower energy prices and a stronger euro.

Core inflation is projected to decline to 2.4% in 2025 and to 1.9% in both 2026 and 2027, essentially in line with previous forecasts.

On the growth front, the ECB forecasts that real GDP will grow by 0.9% in 2025, 1.1% in 2026, and 1.3% in 2027. Although the 2025 GDP forecast remains unchanged due to strong first-quarter performance, the ECB acknowledges that economic growth for the remainder of the year is likely to be softer, partly due to trade-related uncertainties.

Global demand weakness and potential retaliation against US tariffs may continue to weigh on exports and business investment. However, an increase in public investment, particularly in defense and infrastructure, is expected to provide some support for economic growth in the medium term.

Short-Term Correction Expected, Medium-Term Trend Likely to Resume Downward_1

Technical Analysis

The unexpected hawkish outcome of the ECB meeting has led to a short-term rebound and stabilization in EURNZD. Technically, the current price is in a downward correction structure, with a short-term bearish bias. However, there is a significant medium-term opportunity for a substantial pullback, as the monthly chart structure remains in a head-and-shoulders top pattern. Close attention should be paid to a potential breakout above 1.9169. If this level is breached, the downward structure will be invalidated.

Trading Recommendations

Trading Direction: Sell

Entry Price: 1.8945

Target Price: 1.8170

Stop Loss: 1.9125

Deadline: June 21, 2025, 23:55:00

Support: 1.8859/1.8809/1.8713

Resistance: 1.8978/1.9048/1.9093

Risk Warnings and Disclaimers

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Alan

Forex

Summary:

Recent US economic data has been lackluster, with ADP employment figures falling short of expectations. If today's non-farm payrolls report underperforms expectations, it could lead to further declines in the US dollar.

SELL USDX

Close Time

CLOSED

98.950

Entry Price

96.900

100.500

98.920 -0.030 -0.03%

48.0

Pips

Profit

96.900

98.470

Exit Price

98.950

Entry Price

100.500

Fundamentals

The US economy is currently mired in a classic stagflation trap characterized by "low growth + high inflation." The May ADP employment report showed an increase of only 37,000 jobs, the lowest since March 2023. The ISM Services PMI fell below the 50-mark to 49.9, indicating a contraction in economic activity. However, the Prices Paid Index soared to a 30-month high, highlighting the increasing pressure on businesses to pass on costs. This contradiction has left the Federal Reserve in a policy dilemma—cutting rates could fuel inflation, while maintaining high interest rates could accelerate economic recession.

More critically, the Trump administration has proposed eliminating the debt ceiling, attempting to ease short-term pressures through unconstrained fiscal expansion. The US national debt has already climbed to $36.94 trillion. If this policy is implemented, the deficit could expand by $3.6 trillion over the next decade, which will significantly increase the risk of debt default. After Moody's downgraded the US credit rating, global central banks accelerated the reduction of US dollar assets, dealing a systemic blow to the dollar's status as a reserve currency. The share of renminbi (RMB) settlements rose to 4.99%, and Middle Eastern oil-producing countries are shifting towards RMB trade settlements. This policy not only weakens the dollar's credibility but also triggers market panic over "fiscal dominance of currency"—as the White House sacrifices long-term stability for short-term stimulus, the foundation of the dollar as a store of value is being eroded.

It is worth noting that the US will release its May non-farm payrolls data later today. If the data underperforms expectations, it will further weigh on the already weak US dollar.

Technical Analysis

From the daily chart perspective, the candlestick structure of the US Dollar Index has formed a head-and-shoulders top pattern, with the neckline at 99.10 already breached. This opens up further downside potential for the index, with the first target potentially falling to 96.60.

In terms of technical indicators, the daily MACD's fast and slow lines have formed a death cross, and the RSI is around 43, not yet in the oversold territory. This suggests that market sentiment remains bearish, with strong selling pressure still in place.

In conclusion, traders are advised to focus on shorting rallies.