The USD/CAD is the subject of focus for those trading the joint employment data release from the US and Canada.
The US NFP report shows a lower unemployment rate (4.8% versus consensus of 5.1%) but without a corresponding increase in the number of jobs added (only 194K jobs added versus consensus of 490K). On the other hand, Canada registered a positive employment change of 157.1K (versus a consensus of 59.5K), with an unemployment rate of 6.9%, which met expectations but represented a decrease from the previous number.
The Canadian employment report turned out better than that of the US. Coupled with slightly higher crude oil prices on the day, the Loonie is attracting some demand over the greenback, which is why the USD/CAD has maintained the bearish position it started the day with. As of writing, the USD/CAD is down 0.41%, trading lower for the second straight day.
Technical Outlook for USD/CAD
The intraday violation of the 1.25000 psychological support (11 August/3 September lows) needs to transform into a downside penetration close of at least 3% for the bears to have free reign to push towards 1.24489. Other targets to the south exist at 1.23998 and 1.23028. These targets become available of the support at 1.24489 gives way.
The bearish outlook is negated if the bulls successfully defend the 1.25000 support level. A bounce at this level targets 1.25964, with 1.26477 and 1.27419 serving as additional targets to the north.