USD/CAD Forecast: Canadian dollar subdued on mixed Canadian construction data

The Canadian dollar is steady in the Monday session. Currently, USD/CAD is trading at 1.3358, down 0.20% on the day. On the release front, Canadian construction numbers were a mix.

On Friday, the U.S. and Canada posted key employment numbers. U.S. nonfarm payrolls came in at 196 thousand, easily beating the estimate of 172 thousand in March. Still, this release is significantly lower than the December and January releases, both of which were above the 300-thousand level. Wage growth dipped to 0.1%, shy of the estimate of 0.3%. In Canada, employment declined by 7.2 thousand in March, after a huge increase of 55.9 thousand in February.

The Canadian economy has been affected by the trade war between the U.S. and China, especially the manufacturing and export sectors. With talks between the two super-economies continuing, there is optimism that China and the U.S. will reach a deal, and that could boost the Canadian dollar. There were reports this week that an agreement is 90% complete, with the remaining issues including enforcement mechanisms and the removal of trade tariffs.

USD/CAD Fundamentals

Friday (April 5)

• 8:30 US Average Hourly Earnings. Estimate 0.3%

• 8:30 US Nonfarm Employment Change. Estimate 172K

• 8:30 US Unemployment Rate. Estimate 3.8%

• 8:30 Canadian Employment Change. Estimate 3.0K. Actual -7.2K

• 8:30 Canadian Unemployment Rate. Estimate 5.8%. Actual 5.8%

• 15:00 US Consumer Credit. Estimate 17.2B

Open: 1.3384 High: 1.3387 Low: 1.3354 Close: 1.3358

USD/CAD Technical

USD/CAD showed little movement in the Asian session and posted small losses in European trade

• 1.3290 is providing support

• 1.3383 was tested earlier in resistance. It is a weak line

• Current range: 1.3290 to 1.3383

Further levels in both directions:

• Below: 1.3290, 1.3200 and 1.3125

• Above: 1.3383, 1.3445, 1.3552 and 1.3662