USD/CAD looks set to extend downside movement

FXOpen

US Dollar/Canadian Dollar (USD/CAD) closed yesterday with the large bearish engulfing candle around 1.1024. The pair has resumed the downtrend after printing the Lower High (LH) on the daily chart; the investors are seen cautious ahead of the US job data which is scheduled for release tomorrow.

At the time of this writing, the pair is being traded near 1.1040. Immediate resistance is seen around 1.1065 which is the 50% fib level ahead of the 1.1100 handle that is the psychological level and the 61.8% fib level. A break and daily close above the 1.1100 handle shall expose more rallies towards 1.1160.

USD/CAD looks set to extend downside movement

On the downside, support is being noted around 1.0980 which is the confluence of the 23.6% fib level and the 200 Daily Moving Average (DMA). A break below 1.0909 will confirm the bearish bias on USD/CAD.

Today the US labor department is due to release the initial jobless claims report. According to the forecast, the number of people, who claimed for the jobless benefits, reduced to 338,000 during the course of the previous week as compared to 348,000 in the week before. A high jobless claims reading is seen negative for the economy and vice versa. So if the jobless claims report comes better than expectations, it will be bullish for USD/CAD.

On Friday, the US labor department will release the nonfarm payrolls and the unemployment rate figures for the month of February. Economists have predicted a better nonfarm payrolls number while a steady jobless rate figure for the previous week. Better than expected US job data will be bullish for USD/CAD and vice versa. The outcome could also affect the monthly monetary policy meeting which is going to be held on March 18-19 in Washington. The FOMC policymakers might announce another tapering in the stimulus if the job data meets the expectations.

Trade over 50 forex markets 24 hours a day with FXOpen. Take advantage of low commissions, deep liquidity, and spreads from 0.0 pips. Open your FXOpen account now or learn more about trading forex with FXOpen.

This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.

Latest from Forex Analysis

USD/CAD Rate Reaches Significant Support Level Dollar Declines: How Deep Could the Correction Be? USD/JPY Analysis: Rate Rises Above 159.9 Yen per Dollar SNB Unexpectedly Lowers Interest Rate from 1.50% to 1.25% GBP Awaits Bank of England Verdict: Volatility Ahead?

Latest articles

Forex Analysis

USD/CAD Rate Reaches Significant Support Level

On June 12, we wrote about bearish signs observed on the USD/CAD chart, pointing to the prospect of USD weakening.

Since then, the USD/CAD rate has decreased by approximately 0.75% and has reached an important support level,

Indices

Nasdaq 100 Index Failed to Hold Above 20,000 Points

On 18th June, we reported that the Nasdaq 100 (US Tech 100 mini on FXOpen) market had recorded a historic high by surpassing the psychological level of 20,000.

At that time, we pointed to the upper line of the

Forex Analysis

Dollar Declines: How Deep Could the Correction Be?

By the end of last week, the American currency traded rather mixed:

  • The USD/JPY currency pair strengthened by more than 200 pips and almost tested the significant resistance level at 160.00.
  • The USD/CAD pair failed to break
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 60% 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.