USD/CAD Pulls Back Off Session Highs to Trim Weekly Gains

The USD/CAD currency pair on Friday pulled back off session highs of about 1.2984 to trade at about 1.2932. The currency pair continues to trade within an ascending channel formation in the 60-min chart.

The pair has now advanced to trade several levels above the 100-hour moving average line. However, Friday’s late pullback helped the pair to recover from the overbought conditions 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 both markets. On Friday, the US labour department reported that the economy created 528k new jobs in July, more than double the consensus expectation of 250k. The economy also registered a relatively lower unemployment rate of 3.5% compared to 3.6% in June, also beating the forecast of 3.6%.

Elsewhere, the average hourly wage growth outperformed the (YoY) expectation of 4.9% with a growth rate of 5.2%, while the (MoM) equivalent beat 0.3% with 0.5%. Earlier in the week, the initial jobless claims for last week came in slightly higher at 260k versus 259k, while the continuing claims for the preceding week also missed 1.37 million with 1.416 million.

In Canada, the unemployment rate for July remained unchanged at 4.9% from June, beating the forecast rate of 5%. On the other hand, the net change in employment missed the expectation of 20k with -30.6k, indicating that more people lost their jobs than those who got new jobs.

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

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

Therefore, the bulls will be targeting extended gains at about 1.2960, or higher at 1.2984. On the other hand, the bears will look to pounce on potential pullbacks at about 1.2913, or lower at 1.2886.

USD/CAD Technical Analysis (the Daily Chart)

In the daily chart, the USD/CAD currency pair seems to be trading within a gently ascending channel formation. This indicates a slight long-term bullish bias in the market sentiment.

Therefore, the bears will be targeting potential pullback profits at about 1.2827, or lower at 1.2716. On the other hand, the bulls will look to pounce on profits at about 1.3040, or higher at 1.3138.

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