Can US Tariff News End Up Tipping The USD/CAD Lower This April?

  • Instrument: USD/CAD
  • Average Pattern Move: -1.31%
  • Timeframe: 1 Apr – 30 Apr
  • Winning Percentage: 31.58%

Dear Investor,


You may not realise it, but the month of April has historically been a period of weakness for USD/CAD. With new US tariff announcements on the radar for April 2nd and a shifting global trade backdrop, this may present a compelling moment to revisit this pair. The question now is: will tariffs and seasonality align to drive USD/CAD lower again? We want to analyse the data in more detail.

USD/CAD and April: A Strong Seasonal Bias for Weakness

The chart below shows you the typical development of USD/CAD over the month of April based on the past 19 years of data. It reveals a clear downside tendency, with an annualised return of -15.33% and a negative average return of -1.31%. Only 31.58% of the years studied showed gains during this window, highlighting how persistently the pair has struggled during this period.

USD/CAD Seasonal Analysis Seasonax

Looking at the cumulative profit curve, it’s evident that the trend has been consistent over time — a persistent decline in USD/CAD through the April stretch, with notable softness from the second week onward.

Fundamental Setup: Tariff Tensions and USD Headwinds

With the US administration set to unveil new tariff measures on April 2nd — targeting sectors ranging from electric vehicles to critical minerals — markets will be watching closely for how Canada, a key US trading partner, responds. Any perceived friction could stir volatility in USD/CAD.

However, for the pair to really move lower, two things need to happen:

  1. Tariff clarity: If the tariffs are perceived as globally disruptive but relatively soft on Canada, this could ironically bolster CAD by reducing uncertainty and supporting risk sentiment.
  2. Oil support: As a commodity-linked currency, the Canadian dollar tends to benefit from rising crude oil prices. With WTI entering a seasonally strong phase from late March through June, further oil gains could provide a tailwind to CAD.

Combine these factors with weaker US macro surprises and renewed rate cut expectations from the Fed, and the downside pressure on USD/CAD may build.

Technical Perspective

From a technical standpoint there is a major support level for the USDCAD at 1.4000 on the weekly chart marked below. If there is a drop lower in the USDCAD, that is an obvious point for a pause in the fall and a key target for potential sellers.

USD/CAD Technical Analysis

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Trade Risks
A key risk to this view is if the tariff measures are unexpectedly harsh on Canadian exports — especially autos or agriculture — which could weigh on the loonie. Also, any resurgence in US economic data or pushback from Fed officials on near-term rate cuts could underpin the dollar and stall the seasonal trend.

Don’t Just Trade It – Seasonax It!