USD/CAD: Loonie corrects losses after labor market data

The Canadian dollar, also known as the Loonie, was trading somewhat higher on the day, having erased previous intraday losses. The pair was seen at around 1.3590, down from daily highs of 1.3630.

Traders paid attention to Canadian labor market data, which came out above estimates. The unemployment rate improved to 12.3% from 13.7% previously, while the net change in employment rocketed higher to 952,000, up from 289,000 scored in the previous month. The Loonie strengthened after these numbers.

However, the Canadian dollar was still trading weaker on the week as the WTI oil retreated below the important 40 USD per barrel, which undermined the CAD.

Moreover, commodity-linked currencies came under pressure today as traders seem to be really nervous from the rising COVID cases numbers in the US (and worldwide).

The support now seems to be in the 1.3570 area, and if the pair breaks below this level, we could see a retest of the psychological 1.35 zone.

Alternatively, the resistance seems to be at today's highs of 1.3630, and if not held, the greenback might strengthen further toward 1.37.