Current trend

Amid the stabilization of the American currency, the USD/CAD pair is correcting at 1.3564.

The Canadian currency is falling after the publication of the August labor market data. The unemployment rate increased to 6.6%, the highest since October 2021, employment added 0.1% or 22.0K jobs, and the total number of hours worked decreased by 0.1% while increasing by 1.4% YoY. The largest growth was recorded in the fields of education ( 1.7%), healthcare ( 0.9%), and finance ( 0.8%). A rapid outflow of labor was observed in companies providing technical (–0.8%) and utilities (–4.5%), as well as in the natural resources sector (–1.0%). The main pressure fell on the services sector, where business activity declined, too, confirming its weakening.

The American dollar is trading at 101.50 in USDX. Investors reacted neutrally to the August data on auto sales, which reflected a correction from 15.80M to 15.10M against the forecast of 15.40M. Despite the negative dynamics, consumer goods trade is recovering. The July wholesale sales increased from –0.3% to 1.1%, and the indicator of inventories in warehouses – by 0.2%.

Support and resistance

On the daily chart, the price is correcting, approaching the support line of the ascending channel with dynamic boundaries of 1.4000–1.3680. Technical indicators weaken the sell signal. The EMA oscillation range on the Alligator indicator narrows, fast EMA are approaching each other, and the AO histogram forms correction bars below the transition level, approaching it.

Resistance levels: 1.3590, 1.3690.

Support levels: 1.3525, 1.3440.

Trading tips

Long positions may be opened after the price rises and consolidates above 1.3590, with the target at 1.3690. Stop loss is 1.3550. Implementation period: 7 days or more.

Short positions may be opened after the price falls and consolidates below 1.3525, with the target at 1.3440. Stop loss is 1.3570.