USD/CAD extends losses sub-1.4000, approaching 1.3900

USD/CAD extends losses below 1.4000 and hits session lows near 1.3900.
Better than expected Canadian employment data and higher oil prices supporting CAD.
FX analysts at TD Securities see the USD/CAD vulnerable while below 1.4000.

Guillermo Alcala FXStreet

The USD/CAD maintains its negative bias for the second consecutive day and is on track to depreciate a 1.2% on the week, nearing the 1.3900 on Friday's US session. The US dollar is losing ground after having peaked at 1.4170 on Thursday, hammered by a downshift in the Fed fund futures curve, which hinted at negative rates in January 2021.

Employment data support the CAD

The simultaneous release of the US and Canadian employment figures has been buoyed the loonie against the greenback. The CAD has extended its positive trend after a report showing a decline of 1.99 million jobs in Canada in April, which is a substantial improvement from the 4 million loss expected.

Furthermore, the recovery on oil prices, which are set for the second consecutive weekly gain has increased confidence in the commodity-linked Canadian dollar.

The USD, however, has been barely moved by the better than expected US Non-Farm Payrolls report. US Private employment declined by 20.5 million in April, which is better than the 22 million job loss expected, although it has boosted the jobless rate to 14%, the highest rate since WW II.

USD/CAD remains a fade below 1.4000 – TDS

The FX analysts’ team TD securities see the USD/CAD fundamentally challenged, and weak while below 1.4000, “We think USDCAD remains a fade below the 1.40 mark. A close above 1.40 would put the 1.4080/4150 pivots back into view. On the downside 1.3920 and 1.3850 should be supports

Author

Guillermo Alcala

FXStreet

Graduated in Communication Sciences at the Universidad del Pais Vasco and Universiteit van Amsterdam, Guillermo has been working as financial news editor and copywriter in diverse Forex-related firms, like FXStreet and Kantox.

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