• The USD/CAD price analysis indicates renewed hopes of tariff relief in Canada.

• Some US senators are ready to block Trump’s proposed tariff on Canada.

• US data revealed weaker-than-expected business activity in the manufacturing sector.

The USD/CAD price analysis indicates renewed hopes of tariff relief in Canada, which is supporting the loonie. US lawmakers are trying to stop Trump from imposing a 25% blanket tariff on Canadian imports. At the same time, the dollar remained frail after downbeat US economic data in the previous session.

Some US senators are ready to block Trump’s proposed tariff on Canadian imports. Such an outcome would lift the economy’s clouded outlook and allow the Bank of Canada to continue its easing cycle as planned.

Nevertheless, market participants also expect a reciprocal tariff that will impact many countries that trade with the US. These tariffs might also escalate the global trade war and reignite inflation, especially in the US.

The dollar fell on Tuesday after data revealed weaker-than-expected business activity in the manufacturing sector. The ISM PMI fell from 50.3 to 49.0. Meanwhile, economists had expected the index to drop to 49.5. A separate report showed a bigger-than-expected drop in job vacancies, indicating weaker demand for labor.

The downbeat data raised fears of a slowdown in the US economy. Additionally, it increased pressure on the Fed to consider rate cuts. However, market participants and policymakers are more focused on Trump’s speech and the looming NFP report.

USD/CAD key events today

• US ADP nonfarm employment change

USD/CAD technical price analysis: Bears retest recently broken trendline

On the technical side, the USD/CAD price has collapsed after meeting the 1.4400 resistance level. As a result, the price has dropped back below the 30-SMA, and the RSI is under 50, supporting a bearish bias.

-Are you looking for the best MT5 Brokers? Check our detailed guide-

The price recently broke above a solid resistance trendline, indicating a bullish sentiment shift. It was also a sign that bulls were ready to reverse the trend. However, the price has pulled back to retest the recently broken trendline. If bulls return, USD/CAD will retest the 1.4400 resistance level. A break above would make a higher high, confirming a new bullish trend.

On the other hand, if bulls are not strong enough to reverse the trend, USD/CAD will retest the 1.4250 support level. A break below this level will confirm a continuation of the downtrend.

https://www.forexcrunch.com/blog/2025/04/02/usd-cad-price-analysis-tariff-relief-hopes-lift-canadian-dollar/