We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.

Free Trading Guides
EUR/USD
Bullish
Oil - US Crude
Mixed
Wall Street
Bullish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
Gold
Bearish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
GBP/USD
Mixed
USD/JPY
Bullish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
More View more
Real Time News
  • U.S. Market Analyst at https://t.co/JsVsSmefgR, Shain Vernier covers - ✔️ Safe haven assets in volatile markets ✔️ Central banks and governments ✔️ How will commodities trade in a recession Only on Trading Global Markets Decoded #podcast. Tune in here: https://t.co/1UmEzEbwiy https://t.co/X15k6b4ZyB
  • The month of May saw equities rise across the board. The #Dow Jones and #DAX 30 will look to hold above nearby support while the #Nasdaq 100 may look to attack all-time highs. Get your #equities market update from @PeterHanksFX here: https://t.co/dQxkG68R0I https://t.co/cgfcOs14qG
  • There is a dramatic departure between yield curve pricing for a recession and other measures of near-term growth; the Q2’20 Atlanta Fed GDPNow is extremely alarming.Get your market update from @CVecchioFX here: https://t.co/eMd3T8EwDO https://t.co/56oUP6we9U
  • The #DAX has now closed the gap from the beginning of March with the index breaking above 61.8% fib at 11592. Get your DAX market update from @JMcQueenFX here: https://t.co/wr67nkxc8z https://t.co/CkxPZn1v3t
  • Emerging market currencies haven’t been treated equally by the effects of global contagion, even if most have suffered to some degree. However withdrawal of investment flows could hit them all. Get your market update from @DavidCottleFX here:https://t.co/QzNoNYgMgP https://t.co/9CV6iZt40j
  • My weekend trading video: 'S&P 500 Rises on Trump China Presser, #NFPs and Rate Decisions Ahead' https://www.dailyfx.com/forex/video/daily_news_report/2020/05/30/SP-500-Rises-on-Trump-China-Presser-NFPs-and-Rate-Decisions-Ahead.html?ref-author=Kicklighter&QPID=917719&CHID=9 https://t.co/ZvoGoibzj1
  • Hopes are high for deeper European economic integration as the continent battles back from the coronavirus slowdowns – but will it hold? What impact can this have on #Euro? Find out from @JStanleyFX here: https://t.co/b9ZWRd4cTr https://t.co/gngm5tKqjz
  • The US Dollar could rise against #ASEAN currencies such as the Singapore Dollar as US-China tensions seem to escalate. The Indian Rupee is also looking ahead of local 1Q GDP data.Get your market update from @ddubrovskyFX here:https://t.co/LkEFJViPWY https://t.co/iL7xlHLBiF
  • #Gold has a short-term bullish set-up that may play nicely with USD weakening. The longer and shorter-term path of least resistance remains higher. Get your $XAUUSD technical analysis from @PaulRobinsonFX here:https://t.co/6gt3F9LuGP https://t.co/B4MVrg8f6i
  • The AUD may suffer as relations between Australia and China deteriorate amid dwindling growth prospects. Euro traders will be closely watching progress in talks about a €500b recovery fund proposal. Get your market update from @ZabelinDimitri here: https://t.co/LkEFJViPWY https://t.co/Fo1wlWyz8r
USD/CAD Negates Pennant Formation Ahead of Canada Employment Report

USD/CAD Negates Pennant Formation Ahead of Canada Employment Report

2020-04-09 00:00:00
David Song, Strategist
Share:

Canadian Dollar Talking Points

USD/CAD consolidates ahead of Canada’s Employment report and the exchange rate may continue to face range bound conditions going into the Easter holiday as it fails to track the pennant formation carried over from the previous month.

USD/CAD Negates Pennant Formation Ahead of Canada Employment Report

USD/CAD attempts to retrace the decline from earlier this week as the Bank of Canada’s (BoC) Business Outlook Survey reveals that “business sentiment had softened in most regions even before concerns around COVID‑19,” and the update to the employment report may produce headwinds for the Canadian Dollar as the economy is anticipated to shed 500K jobs in March.

Image of DailyFX Canada economic calendar

At the same time, the Unemployment Rate is expected to increase to 7.5% from 5.6% in February, which would mark the highest reading since 2012, and the economic shock from the coronavirus may force the BoC to further support Canadian households and businesses as the “Governing Council stands ready to take further action as required to support the Canadian economy and its financial system and to keep inflation on target.

It seems as though the BoC will rely on its unconventional tools to combat the weakening outlook for growth as the emergency rate cut in March “brings the policy rate to its effective lower bound,” and the central bank may look to expand its asset purchase programs over the coming months in order to “minimize any permanent damage to the structure of the economy.

In turn, Governor Stephen Poloz and Co. may continue to endorse a dovish forward guidance at their next meeting on April 15, and the BoC may continue to push monetary policy into uncharted territory as the central bank carries out the Commercial Paper Purchase Program while acquiring Government of Canada securities in the secondary market.

With that said, it remains to be seen if Canada’s Employment report will alter the near-term outlook for USD/CAD amid the limited reaction to the US Non-Farm Payrolls report, and the exchange rate may continue to face range bound conditions over the coming days as it fails to track the pennant formation carried over from the previous month.

Forex for Beginners
Forex for Beginners
Recommended by David Song
Forex for Beginners
Get My Guide

Sign up and join DailyFX Currency Strategist David Song LIVE for an opportunity to discuss potential trade setups.

USD/CAD Rate Daily Chart

Image of USD/CAD rate daily chart

Source: Trading View

  • Keep in mind, the near-term rally in USD/CAD emerged following the failed attempt to break/close belowthe Fibonacci overlap around 1.2950 (78.6% expansion) to 1.2980 (61.8% retracement), with the yearly opening range highlighting a similar dynamic as the exchange rate failed to test the 2019 low (1.2952) during the first full week of January.
  • The shift in USD/CAD behavior may persist in 2020 as the exchange rate breaks out of the range from the fourth quarter of 2019 and clears the October high (1.3383), but the Relative Strength Index (RSI) offers a mixed signal as the oscillator fails to retain the upward trend from earlier this year.
  • As a result, USD/CAD may face range bound conditions as it snaps the pennant formation carried over from the previous month.
  • However, the lack of momentum to hold above the 1.4010 (38.2% retracement) to 1.4040 (23.6% retracement) region may open up the Fibonacci overlap around 1.3810 (50% retracement) to 1.3830 (100% expansion), with the next area of interest coming in around 1.3720 (78.6% expansion).
Traits of Successful Traders
Traits of Successful Traders
Recommended by David Song
Traits of Successful Traders
Get My Guide

--- Written by David Song, Currency Strategist

Follow me on Twitter at @DavidJSong

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES

News & Analysis at your fingertips.