- Canadian Dollar rises slightly against US Dollar following mixed economic data.
- Soft US GDP growth and strong ADP Employment Change figure support the USD in Wednesday session.
- NFP expectations point to a decline in payrolls due to hurricanes and Boeing strike, potentially weakening USD.
The USD/CAD pair trades neutrally on Wednesday near 1.3915. The Canadian Dollar is gaining some ground against its US counterpart despite mixed economic data from the US. Softer Gross Domestic Product (GDP) growth than expected from Q3 and a strong ADP Employment Change report for October are moving the markets in Wednesday’s session.
However, Tuesday’s declining JOLTS Job Openings and expectations of a Federal Reserve (Fed) rate cut have weighed on the US Dollar. The release of the PCE Prices Index and Nonfarm Payrolls (NFP) report later this week is expected to provide further direction to the USD/CAD pair amidst ongoing market volatility.
Daily digest market movers: Canadian Dollar on neutral ground after US data
- Strong October ADP employment data (233K vs. 115K expected) strengthens the US Dollar against the Canadian Dollar.
- Q3 US GDP growth of 2.8% falls short of expectations but remains robust in the context of a global economic slowdown. The market had expected 3.0%.
- JOLTS report on Tuesday showed a decline in job openings in September, raising concerns about the labor market and pressuring the US Dollar.
- Futures markets now fully price in a 25 bps interest rate cut by the Fed next week with chances of a further cut in December easing.
- Personal Consumption Expenditures (PCE) Prices Index expected to show continued easing of price pressures on Thursday.
- NFP report on Friday expected to show a significant decline in new payrolls, potentially weighing on the US Dollar.
- Bloomberg consensus for October NFP is 110K vs. September’s 254K and a whisper number of 127k.
USD/CAD technical outlook: Bullish momentum remains, strong resistance at 1.3920
The Loonie’s Relative Strength Index (RSI) is in the deep overbought area at a value of 75 with a mildly declining slope, suggesting that buying pressure is easing. Also, the Moving Average Convergence Divergence (MACD) is flat and green, suggesting that buying pressure is at least neutral.
Buyers will potentially take a breather in the next session and use the 1.3900 support to consolidate the Aussie trade in the next few sessions.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.