USD/CAD – Canadian dollar steady ahead of U.S. nonfarm payrolls

The Canadian dollar is drifting in Thursday trade. In the North American session, the pair is trading at 1.3349, down 0.01% on the day. On the release front, Canadian Ivey PMI is expected to improve to 51.4 points. In the U.S., today’s highlight is unemployment claims, which is expected to rise to 215 thousand. On Friday, the U.S. releases wage growth and nonfarm payrolls, so traders should be prepared for movement from USD/CAD.

It’s been a disappointing week for U.S. numbers, and the trend continued on Wednesday. ADP nonfarm payrolls plunged to 129 thousand, down from 183 thousand in the previous release. Is this a precursor of what to expect on Friday? Nonfarm payrolls are projected at 175 thousand, a soft number in comparison to recent releases. ISM Non-Manufacturing PMI also stumbled on Wednesday, falling from 59.7 to 56.1 points.

What can we expect from the Bank of Canada? Governor Stephen Poloz spoke earlier in the week, saying that global trade tensions are weighing on the Canadian economy. Poloz acknowledged that the slowdown has been worse than the BoC anticipated, but insisted that the economy will bounce back in the near future. At the same time, Poloz said that the bank intended to keep interest rates below the neutral range. This dovish stance has made the Canadian dollar less attractive to investors, and the currency could face further headwinds if economic data fails to improve.

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USD/CAD Fundamentals

Thursday (April 4)

  • 7:30 US Challenger Job Cuts. Actual 0.4%
  • 8:30 US Unemployment Claims. Estimate 215K
  • 10:00 Canadian Ivey PMI. Estimate 51.4
  • 10:30 US Natural Gas Storage. Estimate 2B

Friday (April 5)

  • 8:30 US Average Hourly Earnings. Estimate 0.2%
  • 8:30 US Nonfarm Employment Change. Estimate 175K
  • 8:30 US Unemployment Rate. Estimate 3.8%

*All release times are DST

*Key events are in bold

USD/CAD for Thursday, April 4, 2019

USD/CAD, April 4 at 8:10 EST

Open: 1.3345 High: 1.3365 Low: 1.3338 Close: 1.3349

USD/CAD Technical

S3 S2 S1 R1 R2 R3
1.3125 1.3200 1.3290 1.3383 1.3445 1.3552

USD/CAD has shown limited movement in the Asian and European sessions

  • 1.3290 is providing support
  • 1.3383 is the next resistance line
  • Current range: 1.3290 to 1.3383

Further levels in both directions:

  • Below: 1.3290, 1.3200 and 1.3125
  • Above: 1.3383, 1.3445, 1.3552 and 1.3662

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Kenny Fisher

Kenny Fisher

Currency Analyst at Market Pulse
Kenny Fisher joined OANDA in 2012 as a Currency Analyst. Kenny writes a daily column about current economic and political developments affecting the major currency pairs, with a focus on fundamental analysis. Kenny began his career in forex at Bendix Foreign Exchange in Toronto, where he worked as a Corporate Account Manager for over seven years.