USDCAD on Friday rose 0.27% to 1.39109. Week ending 2024-11-08 moved lower by -0.06%. What happened.

USDCAD Analysis

Performance
Period	Pct	Chg	Momentum
Friday	0.27%	36.9 Pips
Week 2024-11-08	-0.06%	-7.9 Pips
November	-0.17%	-24.3 Pips

Upcoming key events for the new week (London Time)

Mon 05:00 AM Remembrance Day
Mon 05:00 AM Veterans Day
Wed 01:30 PM CPI Inflation Rate (12-mth)
Thu 01:30 PM Initial Unemployment Insurance Claims
Thu 01:30 PM PPI excluding Food and Energy sectors (12-mth)
Thu 08:00 PM Federal Reserve Chair Jerome Powell speech
Fri 01:30 PM Monthly Retail Trade (1-mth)

What happened over the week

In the United States, the Index of Consumer Sentiment, as per the University of Michigan’s November flash estimate, showed improvement, rising to 73 points from October’s 70.5 points. The Federal Reserve cut the Federal Funds Rate to 4.75% from 5%, an indication of an accommodative monetary stance. Preliminary estimates for Q3 revealed a drop in Unit Labor Costs to 2.4%, illustrating a slower wage growth environment. U.S. Initial Unemployment Insurance Claims increased slightly to 221,000, as reported by the Department of Labor. Meanwhile, U.S. Nonfarm Business Labor Productivity fell to 2.2% in Q3. Donald Trump winning the presidential race against Harris could influence economic policy directions in the upcoming term. Improving new orders for manufactured goods were documented, albeit still in the negative territory, adjusting to -0.5% in September from -0.8% in August based on the U.S. Census Bureau.

In Canada, the Labour Force remained largely stagnant with the unemployment rate steady at 6.5% in October, according to Statistics Canada. However, there was a decrease in the Labour Force Net Change in Employment, falling to 14.5K from 46.7K in September, suggesting a cooling labor market. On a positive note, Canada’s average hourly wages over 12 months grew to 4.9% in October, up from 4.5% the previous month, indicating wage pressure as per Statistics Canada data.

The current economic indicators suggest slight but mixed implications for the USDCAD pair. With the Federal Reserve cutting rates, it points to a dovish stance that may exert downward pressure on the U.S. dollar. Conversely, Canada’s labor market shows robust wage growth despite a drop in employment changes. These factors contribute to the recent movement of USDCAD wherein it rose 0.27% to 1.39109, despite hitting a two-week low earlier in the week. Upcoming U.S. economic events, especially with the CPI, PPI reports, and Powell’s speech, could influence further movements as they could impact investor sentiment towards the U.S. dollar’s strength. Observers should closely monitor these events to gauge the ongoing volatility and directional changes in the USDCAD pair.

From X (Twitter)

#Employment was little changed in October 2024 (+15,000; +0.1%) and the employment rate fell 0.1 percentage points to 60.6%.

The #unemployment rate was unchanged at 6.5%.

For more info: https://t.co/4oCNHtZ5Ha pic.twitter.com/fjVqC0CLb3

— Statistics Canada (@StatCan_eng) November 8, 2024

What can we expect from USDCAD for the new week and what happened on Friday?

USDCAD on Friday rose 0.27% to 1.39. Price is above 9-Day EMA while Stochastic is rising. For the week ending 2024-11-08, the pair dropped -0.06% or -7.9 pips lower.

Looking ahead, USDCAD looks bullish as the pair ended higher after Friday trading session.

For the new week, our technical outlook is mixed. To see upside interest, we prefer to look at price breakout of week high of 1.40 or at least consolidates above Weekly Pivot level of 1.39. On the downside, we are looking at week low 1.38 or 1.38 (WS1) as immediate support level. USDCAD need to break on either side to indicate a short-term bias. A close below week low of 1.38 would indicate selling pressure.

For the month of November, USDCAD is down by -0.17% or -24.3 pips lower.

Weekly key levels to watch out:

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Labour Force Survey, October 2024 Source: Statistics Canada
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Monthly Wholesale Trade: Sales and Inventories Source: Census Bureau
Federal Reserve issues FOMC statement Source: Federal Reserve
U.S. International Trade in Goods and Services, September 2024 Source: Bureau of Economic Analysis
U.S. International Trade in Goods and Services Source: Census Bureau
Manufacturers’ Shipments, Inventories, and Orders Source: Census Bureau