USD/CAD is around 1.3950 as markets look to major speeches by Federal Reserve officials and upcoming reports on Canadian jobs. The lack of recent US economic data releases following the government shutdown has left markets hungry for new information about the US job market and the Fed’s interest rate policy. Concurrently, Canada’s September employment report, to be published on Friday, will offer important direction to the Bank of Canada for its monetary policy. Technically, the pair is still trading above its 20-day EMA with the support of high bullish momentum on the RSI, meaning that it can make further advances if it penetrates key resistance areas.
KEY LOOKOUTS
• Investors will be watching closely for statements from Federal Reserve officials for indications of future interest rate action with anticipation of possible rate reductions.
• The employment report for September, out Friday, may have an impact on the direction of the Bank of Canada’s monetary policy and the movement in USD/CAD.
• A break above 1.4000 could aim for 1.4075 and 1.4144, whereas a fall below 1.3722 could set the way for 1.3600 and 1.3540.
• With scant US economic data lately on account of the government shutdown, traders are looking to any new labor market data in order to assess currency momentum.
USD/CAD is in a narrow band about 1.3950 as markets wait for major direction from both the Federal Reserve and future Canadian jobs data. The absence of recent US economic reports owing to the government shutdown has raised hopes of Fed policymakers’ speeches, which might shed light on the central bank’s interest rate policy. On the Canadian front, the employment report in September is likely to have a strong bearing on the Bank of Canada’s policy outlook. Technically, the pair is backed above the 20-day EMA, and the RSI suggests strong bullish momentum, which is an indication that further gains are possible if major resistance levels are overcome.
USD/CAD is trading around 1.3950 as investors wait for Fed speeches and Canada’s September employment numbers. The pair exhibits bullish momentum above its 20-day EMA, with a possible break to 1.4000 if resistance holds. Interest rate signals and labor market indicators are all the market cares about.
• USD/CAD is trading around 1.3950 in early European trading.
• Investors look forward to speeches from several Federal Reserve officials to gauge interest rates.
• US economic data in recent times were constrained by the government shutdown.
• Canada’s employment report for September, which comes out Friday, may have some bearing on the policy expectations of the Bank of Canada.
• The pair continues to trade above the 20-day EMA, reflecting a short-term bullish trend.
• The 14-day RSI is more than 60, demonstrating high bullish momentum.
• Levels to observe: resistance at 1.4000–1.4144 and support at 1.3722–1.3540.
USD/CAD traded about 1.3950 lately as market participants eye Federal Reserve officials’ speeches in the coming days and significant Canadian employment figures. The absence of US economic data releases last week amid the partial government shutdown left markets looking for new clues on the health of the US labor market as well as the Fed’s monetary policy stance. Market participants are eyeing these events closely to get a sense of the central bank’s direction on interest rates in the next few months.
USD/CAD Daily Chart Price
SOURCE: TradingView
On the Canadian side, there is growing attention to September’s employment report, which should offer key guidance for Bank of Canada policy. Traders are also gauging overall economic sentiment and labor market dynamics in both nations in order to project how these forces might impact the USD/CAD currency pair. Generally speaking, investor attention continues to be on policy signals and economic data and not short-term price fluctuations.
TECHNICAL ANALYSIS
USD/CAD is still trading above its 20-day Exponential Moving Average (EMA) of about 1.3890, which points to a short-term trend that is bullish. The 14-day Relative Strength Index (RSI) remains above 60, an indication of high upward momentum. A strong break above the psychological point of 1.4000 may pave the way for the way back to previous highs of 1.4075 and 1.4144, or a close below the August 7 low of 1.3722 may expose support areas around 1.3600 and 1.3540. Investors are watching these major levels closely for potential reversal or breakout opportunities.
FORECAST
Looking forward, USD/CAD can further its upside if the bullish trend prevails, especially in case of a break above the important psychological level of 1.4000. Such a breakthrough will set the stage for resistance levels of 1.4075 and 1.4144, driven by upbeat sentiment from any dovish language by the Fed or robust Canadian economic indicators. Investors will consider these levels as potential targets for short-term profit-taking.
On the negative side, a break below the August 7 low of 1.3722 might lead to a correction towards support zones of 1.3600 and 1.3540. Softness in US economic data or adverse surprises on Canada’s employment report may fuel the selling pressure, raising the possibility of a larger pullback. Investors can keep an eye on these support levels for possible trend reversals.
