USD/CAD was testing the highs early in November, with the price trading around 1.39, before making a sharp reversal. The price found support on the daily chart and bounced off higher to 1.3860 a week after, but buyers couldn’t make a new high above 1.39 and the lower high signaled that sellers were in control, which is despite the retreat in crude Oil prices.

The USD has been declining for over a month, with major currencies taking full advantage of the greenback’s weakness. Moving averages have been working as support on the daily chart, with the 50 SMA (yellow) holding twice in the last month, although that moving average was eventually broken last week, which opened the door for further declines in this pair.

On Friday the employment report from Canada showed that the unemployment rate ticked higher to 5.8% in November from 5.7% in October. But that was in line with expectations and the employment change jumped higher. USD/CAD continued to slide lower, although most of the decline has come from the USD side, with the Buck being on a strong retreating period.

Canadian November 2023 Employment Report

• November employment change +24.9K vs +15.0K expected
• October employment change was +15.0K
• Unemployment rate 5.8% vs. 5.8% expected — highest since January 2022
• October unemployment rate was 5.7%.
• Full-time employment +59.6K vs -3.3K last month
• Part-time employment -34.7K vs. +20.8k last month.
• Participation rate 65.6% vs 65.6% last month.
• Average hourly wages for permanent employees 5.0% vs 5.0% last month

This is a decent employment report, and it should give the Bank of Canada pause next week before switching to a neutral. The positions are all full-time, which is quite amazing, but most of what is going on in Canada is due to population increase. According to StatsCan, “population growth has continued to outpace employment growth.” Manufacturing (+28,000), construction (+16,000). Wholesale and retail commerce (-27,000) and finance, insurance, real estate, rental, and leasing (-18,000) experienced drops.

USD/CAD Live Chart