USDCAD Threatens the 1.3150 Support After Upbeat Canadian Employment Data

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Written By: Eno Eteng (MSTA)

Oct 09, 2020, 14:03 BST 14:03

USDCAD

Summary:

Upbeat Canadian Employment data are helping the Loonie to strengthen further against the greenback. USDCAD down 40 pips on the day.

The USDCAD extended losses for the 3rd day in a row this Friday on USD weakness and stellar Canadian Employment data. The US Dollar was already on the back foot as the markets started to bet on a Joe Biden election victory and subsequent offering of further stimulus post-election.

But the big news for the day is the upbeat numbers posted for the Canadian Employment data. Statistics Canada reports that Canadian Employment Change came in at 378.2K, which was more than the consensus of 150.0K and also more than the 245.8K posted the previous month. The unemployment rate also fell from 10.2% to 9.0%, which was lower than the expected value of 9.8%.

This report has provided further strength to the USDCAD, which has fallen 40 pips in the first 30 minutes of the news release. A shutdown of Gulf Coast oil production and the attendant rise in crude oil prices has given the Loonie a tailwind, helping it to further gains against the greenback.

Technical Outlook for USDCAD

The pair is now challenging the 1.31501 support. A breakdown of this support area opens the door towards 1.31413, with 1.30385 and 1.29953 looking like potential candidates for support tests in the short-term.

Any recovery in the pair could be an opportunity to sell on rallies. Such recovery may seek for potential upside rejection targets at 1.32044 or 1.33487.

USDCAD Daily Chart

Written By: Eno Eteng (MSTA)

Eno is a certified financial technician and member of the UK Society of Technical Analysts. He loves to trade and write about stocks, Forex, and CFDs. Since 2009, he has consulted several financial companies as a trader and strategy developer. His work can be seen on several forex blogs and trading educational websites.