USDCAD Open (6:00 am EDT) 1.3359-62 Overnight Range 1.3351-1.3366
The US dollar has a spring in its step this morning. Canadian and US employment reports woke FX markets from a slumber and traders scrambled to buy greenbacks against the major G-10 currency pairs. The US added 196,000 new jobs in March, beating estimates for a 180,000 gain and vastly improved over February’s 20,000 increase. Average Hourly Earnings dipped to 3.2% from 3.4% which took some of the bloom off the rose, for the report.
The Canadian employment data was close to estimates. Canada lost 7,200 jobs in March which was expected but still managed to gain 116,000 jobs in Q1 2019 for an average of 38,666 per month.
USDCAD popped to 1.3401 after the release of the US and Canadian data, but prices quickly retreated to 1.3374. EURUSD recovered its post data losses as well.
Overnight, FX markets were a snoozefest in Asia and not much better during the European session. The nonfarm payrolls report will disturb their slumber. Once again, the major G-10 currency pairs were flat-lining at the New York open, compared to yesterday’s closing levels.
GBPUSD has been the most active currency, rising from 1.3075 to 1.3121 in Asia and then dropping down to 1.3027 after the NFP report. UK PM asked the EU for a Brexit delay until June 30. EU Council President is proposing a year-long extension with the UK having the right to bail as early as July 1.
President Trump is suggesting that a US/China trade agreement could happen in the next month and China President Xi Jinping echoed that sentiment. Trump described the potential deal as “This is the Grand Daddy of them all, and we’ll see if it happens. It’s got a very good chance of happening.” FX traders ignored the comments because they weren’t anything new.
Traders are patiently awaiting the US and Canadian employment reports. US Non-farm payrolls are expected to rebound to 180,000 from February’s dismal 20,000 gain.
USDCAD could see reduced support from oil prices thanks to surging US crude production which is helping to offset Opec production cuts and reduced supply from sanctions.USDCAD Technical Outlook
The intraday USDCAD technicals are bullish following the break of the 1.3380 area to and looking to test resistance at 1.3440. A move above 1.3440 targets 1.3660. A break below 1.3340 would target the October uptrend line at 1.3305 and then 1.3210. For today, USDCAD support is at 1.3370 and 1.3340. Resistance is at 1.3410 and 1.3440
Today’s Range 1.3340-1.3440
Chart: USDCAD daily