Forex Market: USD/CAD daily trading outlook

Yesterday’s trade saw USD/CAD within the range of 1.2655-1.2553. The pair closed 0.52% lower at 1.2556, extending a 0.53% drop in the previous session.

At 6:49 GMT today USD/CAD was up 0.05% for the day at 1.2562. The pair held in a daily range of 1.2570-1.2556.

Fundamentals

The US Labor Department is expected to report at 12:30 GMT that US non-farm employers probably added 245 000 new jobs in March following a job growth of 295 000 in February. Private non-farm payrolls likely stood at 237 000, compared to 288 000 a month earlier.

The non-farm payrolls report presents the total number of US employees in any business, excluding the following four groups: farm employees, general government employees, employees of non-profit organizations, private household employees. The reading typically varies between 10 000 and as much as 250 000 – 300 000 at times when the economy is performing well. Despite the volatility and the possibility of large revisions, the non-farm payrolls indicator presents the most timely and comprehensive reflection of the current economic state. Total non-farm payrolls account for 80% of the workers who produce the entire Gross Domestic Product of the United States. In case of a smaller-than-expected gain in jobs, the US dollar would certainly see selling pressure.

Average Hourly Earnings probably increased by 0.2% in March from the previous month, when earnings rose by another 0.1% following a 0.5% jump in January.

Meanwhile, the rate of unemployment probably remained at 5.5%, the lowest since April 2008. The unemployment rate represents the percentage of the eligible work force that is unemployed, but is actively seeking employment. A person who is not classified as employed or unemployed is excluded from the statistics.

One counts as unemployed, if they fall in all of the following categories: has been unemployed during the last week; is able bodied; has been seeking employment for a period of at least four weeks, which end during the week when the research is conducted. People who have been laid off and are awaiting to be hired again are also classified as unemployed. In case the unemployment rate met expectations or even fell further, this would have a bullish effect on the greenback, because of the positive implications for consumer spending.

Canada

Data provided by Statistics Canada showed yesterday that the countrys trade deficit narrowed to CAD 0.98 billion in February, defying analysts projections to have widened to CAD 1.8 billion from CAD 1.48 billion in January. Imports fell to CAD 44.51 billion from CAD 44.82 billion the previous month, while exports rose to CAD 43.52 billion from CAD 43.35 in January.

Pivot points

According to Binary Tribune’s daily analysis, the pair’s central pivot point stands at 1.2588. In case it penetrates the first resistance level at 1.2623, it will encounter next resistance at 1.2690. If breached, upside movement may attempt to advance to 1.2725.

If the cross drops below its S1 level at 1.2521, it will next see support at 1.2486. If the second key support zone is breached, downward movement may extend to 1.2419.

In weekly terms, the central pivot point is at 1.2546. The three key resistance levels are as follows: R1 – 1.2687, R2 – 1.2763, R3 – 1.2904. The three key support levels are: S1 – 1.2470, S2 – 1.2329, S3 – 1.2253.