The USD/CAD currency pair on Friday bounced off the current weekly lows of about 1.2653 to surge towards 1.2746 after the latest round of US data. The currency pair continues to trade within a gently descending channel formation in the 60-min chart.

The pair pulled back late on to trade close to the 100-hour SMA. The 200-hour SMA remains a few levels higher. The late pullback also prevented the currency pair from crossing to overbought levels of the 14-hour RSI.

USD/CAD Fundamentals Overview

From a fundamental perspective, the USD/CAD currency pair is trading at the back of a relatively busy period in the US market. On Friday, the US jobs data for December came short of expectations with -140k versus 71k. The average hourly wage for the month outperformed the expected (YoY) change of 4.4% with a change of 5.1%. On the other hand, the unemployment rate remained unchanged from the previous period at 6.7%. The market was expecting a rate of 6.8%. 

Earlier in the week, the ISM Manufacturing PMI for December beat the expectation of 56.6 with 60.7. On the other hand, the ADP Employment Change for the period failed to match the expectation of 88k with -123k while the ISM Services PMI outshone 54.6 with 57.2.

In Canada, the unemployment rate for December edged higher to 8.6% up from 8.5% in the previous month. The market was expecting a rate of 8.6%. The net change in employment for the period failed to match the expectation of -27.5k with a change of -62.6k.

USD/CAD Technical Analysis (the 60-min Chart)

Technically, the USD/CAD currency pair appears to be trading within a descending channel formation in the 60-min chart. This indicates a significant short-term bearish bias in the market sentiment. 

The bulls will be targeting short-term rebound profits at around 1.2746 or higher at 1.2798. On the other hand, the bears will look to extend the current declines towards 1.2653 or lower to 1.2597.

USD/CAD Technical Analysis (the Daily Chart)

In the daily chart, the USD/CAD currency pair appears to be trading within a sharply descending channel formation. This indicates a strong long-term bearish bias in the market sentiment. The pair continues to trade very closely to oversold levels of the 14-day RSI.

The bears will be looking to ride the current bearish trend by targeting profits at around 1.2492 or lower at 1.2258. On the other hand, the bulls will look to pounce for long-term profits at 1.2917 or higher at 1.3141.