The USD/CAD slumped to multi-year lows on Friday, after a stellar Canadian employment report helped cement a strong weekly close for the Loonie against the Greenback.
The CAD has proven to be highly resilient to the latest round of USD strengthening that has been prompted by a demand for the long-term US bonds as a result of rising yields. Buoyed earlier by the OPEC + decision, the latest strengthening of the CAD comes from the February Jobs Report which indicated that Canada added just above 259K jobs. This beat the market expectation of 75K jobs, and also compensates for the -212.8K number seen in January. The unemployment rate fell from 9.4% to 8.2% beating the consensus number of 9.2%.
The CAD is expected to carry the momentum into the next week and if crude oil prices continue to rise, this could drive the USD/CAD towards the 1.2400 mark.
Technical Levels to Watch
Friday’s intraday slide extended the downtrend on the USD/CAD with a downside violation of 1.24790. Time or price filter confirmation of a breakdown of this area opens the door towards 1.24489 and possibly 1.23998.
However, a bullish retracement from current levels puts the breakdown move in abeyance, and targets 1.25323, with 1.25862 and 1.26219 serving as additional targets to the north.
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USD/CAD 4-hour Chart
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