Canadian Employment Change was the one to watch: USD/CAD, CAD/JPY, EUR/CAD

The winner today in employment data was Canada

Jobs 2

The US added only +245,000 jobs to the economy for November vs. 469,000 expected.  This number is not only nearly half of what was expected, but it would be considered an average print during a pre-coronavirus month.  The winner today in employment data was Canada, which added 62,000 jobs vs only 20,000 expected and the unemployment rate fell from 8.5% from 8.9%.  Included in the job data were an addition of 99,000 full time jobs, while losing only 37 part time jobs.   The net of these only added to the strength of the data.


USD/CAD has been weak for a while now, and the jobs data only adds to the weakness (strong Canadian Dollar).  However, on a 240-minute timeframe, USD/CAD may be ready for a  short-term bounce.  The RSI is in oversold territory near 22.  Anything below 20 is considered extreme oversold territory.  In addition, price is approaching long-term horizontal support from October 2018 near 1. 2782 and the 161.8% Fibonacci retracement level from the lows on November 9th to the highs on November 13th near 1.2767.    Watch for resistance at the November 9th and November 30th lows near 1.2920 and September 1st lows near 1.2990.

Source: Tradingview, City Index


The RSI for CAD/JPY on a 240-minute timeframe is also in overbought territory near at 72.15. In addition, price is currently banging up against trendline resistance at 81.32,  with horizontal resistance just above at the November 9th highs of 81.42.  Further horizontal resistance is at the June 5th highs of 81.90.  If price does pull back, watch for a confluence of support at the upward sloping trendline near 80.60 and horizontal support near 80.50.

Source: Tradingview, City Index


EUR/CAD appears to already have been ahead of the game. Both the Euro and the Canadian Dollar have been strong as of late vs the US Dollar, however one must be stronger.  Heading into yesterday, the Euro was in the lead vs the Canadian Dollar, but price failed to hold above 1.5700 with the RSI in overbought territory.  Price began to retreat yesterday, and today, broke support at 1.5575 and 1.5550.  The RSI has moved back into neutral territory.  Is EUR/CAD ready to reverse?  It is currently at upward sloping trendline support from the November 9th lows near 1.5540.  Next support is the 50% retracement level from the November 9th lows to yesterday’s highs, near 1.5512.  The 61.8% Fibonacci retracement level from that same timeframe is at 1.5465.  (If price gets to this level today, the RSI should be in oversold territory).  If price does bounce from current levels, horizontal resistance is at 1.5555 at 1.5662.

Source: Tradingview, City Index

Although the US Non-Farm Payroll Data may be the more popular to follow than the Canadian Employment Change, the strength of the Canadian data is clearly outshining the US data today.  But after the strength of the Canadian Dollar as of late, watch for a short-term bounce as the RSI may need to unwind a bit!


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