On Friday, the USD/CAD pair significantly strengthened after the publication of US NFPR data.
According to the data, the number of new jobs created in the private sector grew from 137 to 271 thousands, against forecasted 180 thousands, while the Unemployment Rate fell from 5.1% to 5.0% and also exceeded expectations.
At the same time, Friday’s strong data on the Canadian labour market could not support the CAD. The Unemployment Rate fell by 0.1% to 7.0%, while the Net Change in Employment grew from 12.1 to 44.4 thousands, against forecasted fall to 10 thousands.
Support and resistance
Bollinger Bands on the daily chart is growing, while the price range is widening. The indicator, however, formed a weak signal for correctional sales. MACD continues moving up. Stochastic is in the overbought zone and is about to turn horizontally.
The indicators recommend waiting for clearer trading signals.
Support levels: 1.3300 (local low), 1.3265, 1.3212, 1.3164, 1.3100, 1.3037 (3 November low), 1.3000, 1.2951.
Resistance levels: 1.3352 (local high), 1.3416, 1.3457 (29 September high), 1.3500.
Long positions can be opened after the breakout and consolidation above the level of 1.3310 (with the appropriate indicators signals) with targets at 1.3360, 1.3410 and stop-loss at 1.3270. Validity – 1-3 days.
More likely seems to be correctional fall in the pair. Short positions can be opened below the level of 1.3270 with the target at 1.3190 and stop-loss at 1.3290. Validity – 1-3 days.