Strong Canada Employment Report to Curb USD/CAD Rebound

Period

Data Released

Estimate

Actual

Pips Change

(1 Hour post event )

Pips Change

(End of Day post event)

JUN

2018

07/06/2018 12:30:00 GMT

20.0K

31.8K

+22

-11

June 2018 Canada Net Change in Employment

USD/CAD5-Minute Chart

Canada employment bounced back 31.8K in June after contraction 7.5K the month prior, while the jobless rate unexpectedly climbed to 6.0% from 5.8% during the same period as the labor force participation rate climbed to 65.5% from 65.3% in May. A deeper look at the report showed full-time employment increasing 9.1K during the month, with part-time jobs rising 22.7K, while hourly earnings narrowed to 3.5% per annum from 3.9% in May.

The initial uptick in USD/CAD was short-lived, with the exchange rate pulling back from the 1.3140 region to end the day at 1.3089. Review the DailyFX Advanced Guide for Trading the News to learn our 8 step strategy.

USD/CAD Daily Chart

  • Near-term outlook for USD/CAD remains capped by the 1.3130 (61.8% retracement) region, and there appears to be a broader shift in dollar-loonie behavior as both price and the Relative Strength Index (RSI) track the bearish trends carried over from June.
  • May see USD/CAD face range-bound prices amid the string of failed attempts to close below the 1.2980 (61.8% retracement) to 1.3030 (50% expansion) region, but a close below the stated region brings the downside targets back on the radar.
  • Next region of interest comes in around 1.2830 (38.2% retracement) followed by the Fibonacci overlap around 1.2720 (38.2% retracement) to 1.2770 (38.2% expansion), which largely lines up with the May-low (1.2729).

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— Written by David Song, Currency Analyst

Follow me on Twitter at @DavidJSong.

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

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