USD/CAD Hits 1.3400 - Forex News by FX Leaders
The unemployment rate falls back where it was in Canada

What do you get when you add a slow WTI market, robust U.S. jobs growth, and a stagnate Canadian labor market? Clearly, you get a bullish breakout in the USD/CAD. Rates are in the green by 30 pips, with intraday bids having pushed the Loonie as high as 1.3402. To say the least, it wasn’t a great scenario for traders holding shorts going into the U.S. session.

In a Live Market Update from Thursday, I issued a sell recommendation for the USD/CAD from 1.3350. The play turned out to be a miserable loser, producing about 10 pips profit before being wiped out. Trades like that are the reason stop losses exist ― the damage could have been much worse.

USD/CAD Technicals

So, where does the Loonie go from here? At press time (12:45 PM EST), rates are well off of 1.3400, but remain above several levels of resistance-turned-support.

USD/CAD, Daily Chart
USD/CAD, Daily Chart

Here are a few areas to watch for the remainder of today’s session:

  • Support(1): 50% Current Wave Retracement, 1.3373
  • Support(2): Bollinger MP/Daily SMA, 1.3369

Overview: While this market is highly correlated to WTI crude oil, it is difficult to pick a direction at this point. WTI is currently non-committal near the $62.50 handle, as it has been most of the week.

However, rotation back toward daily downside support is a likely scenario. Now that this morning’s active news cycle is a thing of the past, price may be in a position to fall back ahead of the weekend break.

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About the author

Shain Vernier // US Analyst
Shain Vernier has spent over 7 years in the market as a professional futures, options and forex trader. He holds a B.Sc. in Business Finance from the University of Montana. Shain's career includes stretches with several proprietary trading firms in addition to actively managing his own accounts. Before joining FX Leaders, he worked as a market analyst and financial writer.
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