USD/CAD Trying to Decide After the Employment Report from Canada
USD/CAD has ben bearish for more than a year, losing more than 26 cents from top to bottom. The declining USD amd the increasing crude Oil prices have been keeping this pair bearish, although a bottom formed just above 1.20, where this pair has bounced from a few times.
Moving averages have been providing resistance on the H4 chart and a resistance level has formed around 1.2150, which means that the decline has stalled for now and USD/CAD has been trading in a range for nearly a month.
Yesterday we saw another attempt at the upside, but it seems like the reversal has ended now and this pair is attempting to turn bearish after the doji candlestick below the resistance line. The unemployment rate increased to 8.2% in Canada in May, as today’s report showed, while the employment declined for the second time as lockdowns returned. Now this pair is deciding at the 100 SMA (green) whether to return below it and resume the bullish trend.
Canada Employment Report May 2021
- May net change in employment -68.0K versus -25.0K estimate
- April employment was -207.1K
- Full time -13.8 K versus -129.4K last month
- Part-time -54.2 K versus -77.8K last month
- Unemployment rate 8.2% versus 8.1% in April
- Net change in employment -68.0K versus -207.1K previously
- Participation rate 64.6% versus 64.8% estimates. April was 64.9%
- Hourly wage rate for permanent employees -1.4% versus -1.3% estimate. Last month -1.6%
- The transportation sector added 21.9K or manufacturing led the declines with -35.9K
- Private employment felt -60.4 K versus -203.7 K last month
- Public employment felt 10.1 K versus -13.2 K last month
- Manufacturing jobs fell for the first time since April 2020 at -36K
- Construction jobs fell by -16 K driven by declines in Ontario or public health restrictions affected nonessential construction were implemented
- Retail trade fell by -29,000 following a -84,000 decline in April. Retail employment is down 140,000 below pre-pandemic levels which is the lowest level since February 2021
- Employment accommodations and food services remains one third below pre-Covid levels
- Transportation and warehousing gain for the first time since December +22K
- In addition to the employment declines, the number of employed people working less than half their usual hours increased for a second consecutive month, rising by 83,000 (+6.1%). Total hours worked were virtually unchanged in the month, but remained 3.8% below pre-pandemic levels.
In early May, both Alberta and Manitoba introduced measures that included the closure of personal care services, recreational facilities and in-person dining, as well as limits on retail store capacity and a transition to remote schooling for all or large parts of each province.
Nova Scotia entered a province-wide shutdown on April 28, closing non-essential retail stores and moving all schools to remote learning. Provincial border restrictions were tightened on May 10. In contrast, New Brunswick and Quebec eased restrictions in some regions through late April and early May.
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