USDCAD TECHS: Trend Structure Still Bearish

• RES 4: 1.4292 61.8% Retracement Feb’25 - Jan’26 downleg
• RES 3: 1.4264 1.618 proj of the Mar 9 - 31 - May 1 price swing
• RES 2: 1.4248 High Jun 24, 25 and 30 and the bull trigger  
• RES 1: 1.4129/4190 High Jul 28 / 9  
• PRICE: 1.4018 @ 16:42 BST Aug 05
• SUP 1: 1.3991 Low Jul 30
• SUP 2: 1.3981 38.2% retracement of the May 1 - Jun 24 bull cycle  
• SUP 3: 1.3951 Low Jun 15
• SUP 4: 1.3899 50.0% retracement of the May 1 - Jun 24 bull cycle 

The USDCAD trend structure remains bullish and the bear cycle since Jun 24 is considered corrective. Attention is on the next important support at 1.4036, the 50-day EMA. It has been pierced but - for now - remains intact. A clear break of it would signal scope for a deeper correction and open 1.3981 initially, a Fibonacci retracement. Key resistance and bull trigger is 1.4248, the Jun 24, 25 and 30 high. First resistance is at 1.4129, the Jul 28 high.  

• Treasuries look to finish near steady to mildly higher Wednesday, inside session range as US/Iran deal optimism vacillated.
• Treasuries inched off midday lows following the latest Iran headlines - for what they are worth - that Iran has received messages that US is "ready to return to it's pledges" - that in itself "is not enough" to reopen the strait, followed by a even less optimistic headline that ther have been "no talks with the US ... in recent days".
• Currently, TYU6 trades +1 at 108-28 vs. 109-01 high, yield +.0082 at 4.6208%. Key resistance is 109-08, the 5–day EMA. Projected rate hike pricing consolidating vs. late Tuesday levels (*): Sep'26 at +13.7bp (+14.5bp), Oct'26 at 20.4bp (20.9bp), Dec'26 31.3bp (+31.8bp), Jan'27 33.9bp (34.9bp).
• The services PMI saw a solid upward revision in its final July reading and an unexpected one considering Monday’s manufacturing report had been only revised marginally higher. Services PMI: 54.6 (cons 53.6, flash 53.6) in July after 51.2 in June - strongest since Oct 2025
• ADP employment was softer than expected as it increased 44k in July (sa, cons 65k) after a marginally downward revised 95k (initial 98k) in June, seeing its softest monthly increase since January.
• Cross asset update: Stocks are mixed late Wednesday, paring gains after the DJIA and SPX emini indexes climb to new record highs in the first half (54744.33 and 7820.25 respectively). Sentiment gradually cooled as the day wore on with no announcement of a verified deal - the Nasdaq trading in the red at approximately 26444.0 vs. 26739.0 high (still shy of early July record high of 27093.0).
• Crude weaker: WTI Sep 26 is down by 0.7% at $75.2/bbl.
• Look ahead: ​Italy industrial production, GB construction PMI, EU Retail Sales, Mexico rate annc. Main focus remains on Friday's July employment report for the US.

• Looking ahead to Friday's nonfarm payrolls report, MNI's compilation of primary dealers' expectations for payrolls growth is slightly more pessimistic than the broad Bloomberg median at 75k (cons 80k) but a little more optimistic on private payrolls at 90k (cons also 80k).
• The relative difference between the primary dealer medians for nonfarm and private payrolls are in part down to a reduced sample for private estimates, with more entries missing at the lower end of the spectrum.
• A majority expect the unemployment rate to round to 4.2% again although there is a clear dovish skew to risks with six primary dealer analysts looking for 4.3%. 

• AHE growth is also seen at 0.3% M/M again but with a dovish skew with five looking for 0.2% M/M.