USD/CAD drops to fresh multi-year lows post-US/Canadian employment details

The USD/CAD pair broke down of its intraday consolidative trading range and dropped to 1.2825-20 region, or the lowest level since October 2018 at the beginning of the New York session.

The latest leg of a sudden fall during the early North American session followed the release of monthly jobs report from the US and Canada. In fact, the headline NFP showed that the US economy added 245K new jobs in November, down from 610K previous (revised from 638K) and worse than 469K anticipated.

The disappointing reading, to some extent, was offset by a fall in the unemployment rate, which edged lower to 6.7% as against 6.8% expected and October's 6.9%. The data did little to provide any respite to the US dollar bulls, which remained depressed near two-and-a-half-year lows.

On the other hand, Canadian monthly employment details came in better-than-expected and showed that the economy created 62K new jobs in November. Adding to this, the unemployment rate unexpectedly dropped to 8.5% during the reported month, from 8.9% recorded in the previous month.

This comes on the back of the recent bullish run in crude oil prices, which provided an additional boost to the commodity-linked loonie. This, in turn, exerted some fresh downward pressure on the USD/CAD pair and might have already set the stage for an extension of the bearish trend.

Technical levels to watch