• Canadian employment data missed expectations, losing jobs in October.
  • Crude oil prices edged lower after reaching fresh six-week highs.
  • USD/CAD with the risk skewed to the upside for the upcoming days.

The Canadian dollar is ending the week with substantial losses against its American rival, with the USD/CAD pair up for a second consecutive week. This Friday, disappointing Canadian employment data exacerbated the pair’s rally, as the country lost 1,800 positions in October, against the expected 15.9K creation. The unemployment rate remained steady at 5.5% as expected.

Data from the country released earlier in the week was generally disappointing, as the September Merchandise Trade deficit was larger-than-anticipated, down to $-0.98B. Also, the Ivey Purchasing Managers Index for October resulted at 48.2 seasonally adjusted, worse than the previous 48.7 and the expected 54.4, while Building Permits fell by 6.5%.

Crude oil prices weighed on the Loonie, ending the week with modest losses after reaching fresh six-week highs. Large builds in US stockpiles and news suggesting that the OPEC+ is not willing to cut production further, hurt the commodity.

Meanwhile, the market decided to return to the greenback, amid two main factors: hopes that the US and China will end up closing a deal, and upbeat American data that spooked the ghost of a recession in the world’s largest economy.

The Canadian macroeconomic calendar has little to offer next week, besides a BOC’s Poloz speech next Friday, although he's not particularly expected to refer to Canadian monetary policy.

USD/CAD Technical Outlook

The USD/CAD pair weekly chart shows that it's finishing the week above a flat 20 SMA, while the Momentum indicator remains directionless, consolidating around its 100 level, and as the RSI advances, also around its mid-line, leaving a neutral technical stance.

In the daily chart, however, the risk is skewed to the upside, with the price above its 100 DMA for the first time in almost a month, and technical indicators heading sharply up within positive levels.

The pair has an immediate resistance at around 1.3240, not far from the current level. Gains beyond it will likely end on a test of the 200 DMA, at around 1.3280. The next level to watch would be1.3356, October monthly high.

Below 1.3200, the risk will turn back south, with the price then headed initially to 1.3140 and later toward 1.3115.

USD/CAD sentiment poll

The pair is seen hovering just above the 1.3200 figure during the upcoming weeks, although sentiment seesaws. Neutral in the short term, bulls take over in the monthly view, while bears return quarterly basis. Nevertheless, there are no dominant trends in the three time-frame under study, as the numbers of bears and bulls are quite even throughout all periods.

The Overview chart, however, shows that moving averages are mostly skewed to the upside, with little directional momentum in the monthly view. Gains beyond 1.3400, however, are unlikely, according to polled experts.

Related Forecasts:

EUR/USD Forecast: US-China headlines to keep stealing the show

USD/JPY Forecast: Buy Trump's trade rumor, sell the fact? Powell's outlook also eyed

GBP/USD Forecast: Four Top-tier figures to determine direction after BOE blow, election mess



Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility.

Analysis feed

Latest Forex Analysis

Editors’ Picks

GBP/USD soars past 1.2900 as Farage gives additional boost to Conservatives

GBP/USD has leaped above 1.29, the highest since early November, as the Brexit Party has failed to field candidates in 43 additional seats, facilitating a victory for PM Boris Johnson.


EUR/USD advances 1.10 amid upbeat trade headlines, after mixed US retail sales

EUR/USD is trading closer to 1.1050, up on the day. US Commerce Secretary Ross has expressed optimism about reaching a deal with China. The Retail Sales Control Group met expectations with 0.3%.


USD/JPY clings to gains near session tops, around 108.70 post-US data

The USD/JPY pair maintained its strong bid tone near session tops and had a rather muted reaction to the mixed US economic data.


US Dollar Index challenges weekly lows near 98.00

The US Dollar Index (DXY), which gauges the buck vs. a bundle of its main rivals, is now accelerating the downside and threatens to test the key support at 98.00 the figure.

US Dollar Index News

Trump Impeachment: Markets will not like any replacement

The public phase of the impeachment hearings against President Donald Trump has kicked off, with the US public and parties divided more than ever. How does it affect markets?

Read more

Forex Majors