USDCAD continues the rebound from the seven-month lows for second straight day as the greenback gets a hand from better than expected employment data from the USA.
Bulls Return to USD After Better NFP Data
The U.S. Nonfarm Payrolls (NFP) came in at 1763K, topping the expectations of 1600K in July 2020, but at a slower rate as the U.S. economy added 4.8 million jobs in June. The unemployment rate dropped to 10.20% from 11.1% in June. The Labor Force Participation Rate rose to 61.4%, topping the estimates of 61.1% in July. The Average Weekly Hours came in at 34.5 above the forecasts of 34.4. The Average Hourly Earnings came in at 4.8% also above the estimates of 4.2%. The U6 Underemployment Rate registered in at 16.5% below the forecasts of 19.7%.
Canada Unemployment Rate dropped to 10.9%
From Canada, the Unemployment Rate declined to 10.9% in July, beating the economist’s expectations of 11%. The Participation Rate, on the other hand, registered in at 64.3% below the expectations of 64.4% in July. The Canada Ivey, Purchasing Managers Index, jumped to 65.2 in July from 62.9 in June. Seasonally adjusted Purchasing Managers Index (PMI) came in at 68.5 above the analyst’s forecasts of 57.5 in July.
USDCAD Price Technical Analysis
The USDCAD is 0.65% higher at 1.3387 as the rebound from recent lows gains attraction with the bulls now targeting a break above 1.3418 the top from August 4. Further selling pressure expected at 1.3457 the high from August 3. What can invalidate the bearish trend in the pair is a break above the 50-day moving average at 1.3504.
On the downside, bears need to break below the daily low at 1.3281. Next support would be met at 1.3245 the low from yesterday’s trading session, while the low from August 5 at 1.3235 would provide further support.
USDCAD Daily Chart