USD/CAD falls while Trump’s criticisms the president of the Fed Powell affect the US dollar

• The Canadian dollar gains modestly as the political pressure on the Fed weighs on the US dollar.
• The USD/CAD quotes about 1,3630, lowering 0.70% in the day, staying inside a descending channel.
• The technical perspective remains bassist, with immediate support seen in the Bollinger lower band around 1,3587.

The Canadian dollar (CAD) advances against the US dollar (USD) on Thursday, driven by the widespread weakness of the dollar after recent criticism to the president of the Federal Reserve (Fed), Jerome Powell, by the president of the USA, Donald Trump. The comments, which revived concerns about political interference in monetary policy, affected the confidence of investors in the independence of the Fed, weighing on the US dollar and offering a modest support to the CAD.

The USD/CAD torque is giving up, quoting around 1,3631 at the time of writing, lowering 0.70% in the day. The pair had been in a range during most of the week, showing little directional bias while the Canadian dollar struggled to find traction in the midst of the fall in oil prices. The decrease in geopolitical tensions has weighed over energy markets, limiting support for the Canadian dollar linked to raw materials despite the general weakness of the US dollar.

Meanwhile, the US dollar index (DXY), which measures the strength of the dollar against a basket of six main currencies, is close to 97.22, its lowest level in almost three years. The US mixed economic data published on Thursday added a cautious tone, limiting any rise in the US dollar.

Although the requests for durable goods shot in May, indicating resilience in the manufacturing sector. The US economy contracted 0.5% in the first quarter of 2025, a deeper fall than the 0.2% estimated above, highlighting the underlying economic weakness. In another sign of an economy in cooling, the initial unemployment requests in the US fell to 9,000 to 236,000 in the week that ended on June 21, being below expectations. However, applications remain high compared to the annual average, suggesting a weakening of impulse in the labor market despite the weekly fall.

From a technical perspective, the USD/CAD is still trapped within a well -defined descending channel, with the last rejection near the upper limit reaffirming the bearish structure. The pair is currently quoting about 1,3630 after failing to break the resistance of the trend line drawn from the maximum of March and May.

The Bollinger bands are narrowing, indicating that the market could be preparing for a significant movement soon, with immediate support located around the lower band in 1,3587. A decisive breakdown below this level could expose the psychological brand of 1,3500, while a sustained movement would be needed above 1,3680 to challenge the horizontal resistance of 1,3778 and the upper part of the channel.

Impulse indicators paint a cautious picture, with signs of weakening of bullish attempts. The Relative Force Index (RSI) is around 38, remaining below the Y 50 neutral brand, indicating that the bassist impulse still prevails. Meanwhile, the MACD histogram shows early signs of convergence, with the MACD line trying to cross over the signal line from below, often a preliminary bullish signal, but not yet confirmed. In order for the bulls to obtain significant control, a break is essential above the descending channel. Until then, the path of lower resistance remains down.