CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Open account
☰
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Open account
✖

Canada Employment Change Preview USDCAD

August 5, 2021 5:14 PM

Canada Employment Change Preview: USD/CAD

Don’t forget about Canada! With so much focus on the US Non-farm Payroll data on Friday, traders may be forgetting about one of Canada’s most important economic data releases:  July’s Employment Change! Expectations for the headline print is +177,500 vs +230,700 reported In June.  Canada’s Unemployment Rate is expected to drop to 7.4% from 7.8% in June.  Recall that although Canada had a stronger than expected print for June, ALL those jobs were part time jobs.   +263,900 of June’s Employment Change were part time jobs, full time jobs decreased by 33,200!

Despite this decrease in full time jobs, the Bank of Canada felt it was still appropriate to taper their bond purchases from C$3 billion per week to C$2 billion per week.  The next Bank of Canada Interest Rate Decision meeting isn’t until September 8th; two days before August’s Employment Change is released.  Therefore, this will be the only jobs report before their next meeting.  If the economy lost full time jobs again in July,  despite whatever the headline number is, will the BOC taper again in September?

Learn all about the Bank of Canada

On a 240-minute timeframe, USD/CAD had been moving aggressively higher off its June 1st low of 1.2006 and put in a near-term high of 1.2807 on July 19th.  The pair then began moving lower, breaking through an upward sloping trendline from the June lows. USD/CAD halted its pullback at the 50% retracement level from the June 1st lows to the July 19th highs near 1.2407, however, the bounce failed to break back through the trendline from the lows!  Price turned lower today as the currency pair waits for both sets of jobs data tomorrow.

Source: Tradingview, Stone X

Your guide to the Canadian Dollar

Horizontal support and the previously mentioned 50% retracement level cross at 1.2407/1.2422.  Support below is at the 61.8% Fibonacci retracement level from the same timeframe and horizonal support,  near 1.2312.  The third support level is horizontal support near 1.2203.  First resistance is at the high of August 3rd, near 1.2575, just ahead of the upward sloping trendline near 1.2612.  1.2672 is the final horizontal resistance ahead of the June 1st highs at 1.2882.

USD/CAD is sitting 50 pips above the 50% retracement level from the June 1st highs to the July 19th lows.  Both US Non-Farm Payrolls and Canada’s Employment Change will be released on Friday morning.  The pair should get its next direction from this economic data.

Learn more about forex trading opportunities.


StoneX Financial Ltd (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.

No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.

For further details see our full non-independent research disclaimer and quarterly summary.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. CFD and Forex Trading are leveraged products and your capital is at risk. They may not be suitable for everyone. Please ensure you fully understand the risks involved by reading our full risk warning.

City Index is a trading name of StoneX Financial Ltd. Head and Registered Office: 1st Floor, Moor House, 120 London Wall, London, EC2Y 5ET. StoneX Financial Ltd is a company registered in England and Wales, number: 05616586. Authorised and regulated by the Financial Conduct Authority. FCA Register Number: 446717.

City Index is a trademark of StoneX Financial Ltd.

The information on this website is not targeted at the general public of any particular country. It is not intended for distribution to residents in any country where such distribution or use would contravene any local law or regulatory requirement.

© City Index 2024