- The dollar posts modest gains across the market ahead of key events.
- July employment report is coming from Canada and the US.
- USD/CAD is close to 1.2900, although it will all depend on the data.
The USD/CAD is rising on Friday ahead of Canadian and US employment data. and trades at 1 1/2 week highs at 1.2895. The pair maintains a bullish bias although high volatility is expected.
At 12:30 GMT, the employment reports for Canada and the US will be published simultaneously. An increase in employment of 20,000 is expected in the former, after the fall of 43,200 in June, and a rise in the unemployment rate at 5.0%. Then it will be the turn of PMI Ivey.
The market consensus points to an increase in non-farm payrolls of 250,000. This would imply a slowdown, but still a healthy market. The expectation is that the unemployment rate will remain at 3.6%.
It is expected that the volatility increases with the data. In the previous a certain calm predominates. Although the dollar rises, it does so modestly. USD/CAD is at its highest since July 27, up less than 40 pips. To the upside, major resistance lies ahead around 1.2900, above which further upside would be expected, with the next barrier at last week’s highs at 1.2945.
In the opposite direction, at 1.2855 the nearest significant support can be found. Below is 1.2830, before 1.2800. A daily close clearly below 1.2800 would send a signal of weakness ahead for USD/CAD possibly leading to new lows in months.
Technical levels
Source: Fx Street
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