USD/CAD contained below 1.3220 resistance post Canadian and US jobs data


  • USD/CAD bears lurking below the 200-DMA.
  • The Canadian jobs report was a strong headline figure although the details were somewhat mixed.

USD/CAD dropped on Friday, extending the downside from last week's highs through 1.3380 and reached a low of 1.3158 following Canadian employment that surged by 81k in August, well above the market consensus for 20k. USD/CAD is opening the week at 1.3165.

The jobs report was a strong headline figure although the details were somewhat mixed and softer wage growth remains a concern as is the uncertainty around trade wars for which the Bank of Canada is keeping a close eye on. 

“If, as we expect, there are positive developments on the trade front, the outlook for the global economy and oil prices would improve, negating the need for the Bank of Canada to cut rates. The loonie would then get a double boost, i.e. from yields and oil. As such, we are leaving unchanged our end-of-year target of 1.30 for USDCAD. But as we’ve seen this year, the Canadian dollar’s move towards that target is unlikely to be linear,” National Bank of Canada’s analysts argued. 

NFP should contain Funds below 1.3220 resistance

Other data on Friday weighed on the Dollar in a soft US jobs number which is likely to keep the USD on its backfoot at the start of the week which leaves rallies a fade below and 1.3220 resistance. The US non-farm payrolls were weaker than expected for August, coming in at 130k against expectations of a 160k rise.

"Manufacturing payrolls were at 3k (from 4k in July) whilst trade, transport and utilities were down 11k after rising modestly in July. The US retail sector continued to shed workers. Average hourly earnings beat expectations, rising 0.4% m/m (from 0.3% m/m in July). Year-on-year, average hourly earnings rose 3.2% y/y (from 3.3% y/y in July). The unemployment rate remained steady at 3.7%,"

analysts at ANZ Bank explained. 

USD/CAD levels

Bears are back below the 200-day moving average, now resting at the prior support/resistance 61.8% Fibo confluenceA continuation of the downtrend will be targetting the 1.28 handle - On the flipside, 1.3350 is the near-term target to break still on the upside which guards the 1.34 handle and mid-June highs. 


 

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.

Feed news

Latest Forex News

Editors’ Picks

EUR/USD extends recovery beyond 1.1050 on Saudi output headlines

News indicating that Saudi Arabia’s oil output would return to normal quicker than expected, lifted the market’s mood and weighed on the greenback. EUR/USD underpinned by improved Business Sentiment according to the German ZEW Survey.

EUR/USD News

GBP/USD rallies past 1.2500, reaches fresh multi-week highs

The GBP/USD pair is trading above the 1.2500 figure, getting a boost from easing demand for the greenback following relief news related to the crude oil market after the weekend attack to Saudi facilities.

GBP/USD News

USD/JPY drops back to recent range after hitting fresh 6-week highs

The USD/JPY pair spiked to 108.35, reaching the highest intraday level since August 1st and then pulled back to the 108.15/20 area.

USD/JPY News

Gold struggles to find direction, trades in tight range near critical $1,500 handle

The XAU/USD pair struggling to make a decisive move on Tuesday and continues to trade in a relatively tight range around the $1,500 handle.

Gold News

Saudi Arabia's oil output to be fully back online in next 2-3 weeks

Citing two sources briefed on the Saudi oil operations, Reuters reported that Saudi Arabia's oil output would return to normal levels quicker than initially thought.

Read more

Forex MAJORS

Cryptocurrencies

Signatures