USDCAD Analysis
| Week Ending 2024-10-11 | |||
| Open | High | Low | Close |
| 1.36 | 1.38 | 1.36 | 1.38 |
| Performance | ||||||
| Period | Pct | Chg | Momentum | |||
| Friday | 0.07% | 10.3 Pips |  |
|||
| Week 2024-10-11 | 1.36% | 185 Pips |  October |
1.69% | 228.8 Pips |  |
Upcoming key events for the new week (London Time)
Mon 06:00 AM Thanksgiving Day
Mon 06:00 AM Columbus Day 
Tue 01:30 PM CPI Inflation Rate (12-mth) 
Thu 01:30 PM Initial Unemployment Insurance Claims Thu 01:30 PM Monthly Retail Trade (1-mth)
What happened over the week
The United States experienced a decline in consumer sentiment in October, as reported by the University of Michigan, dropping to 68.9 from 70.1 points in September. The Producer Price Index (PPI) for September remained unchanged, reflecting a 0% variation compared to a 0.2% increase in August. However, when excluding food and energy, the 12-month growth in PPI rose to 2.8% from 2.4% in August. On a monthly basis, the PPI excluding these volatile sectors decreased slightly to 0.2% from 0.3%. Moreover, initial unemployment insurance claims increased to 258K for the week ending October 5, matching the highest since early August. The Consumer Price Index (CPI) rose by 0.2% for three consecutive months, with an annual increase of 2.4%, the lowest since February 2021. This data highlights mixed signals about inflation and economic recovery in the U.S., based on information from the Bureau of Labor Statistics and the Department of Labor.
In Canada, the labor market showed positive developments. Statistics Canada data revealed a 47,000 increase in employment in September, with a slight decline in the employment rate to 60.7%. The unemployment rate fell to 6.5%. However, average hourly wages over the past year decreased from 4.9% in August to 4.5% in September. This indicates a mixed scenario where job growth is apparent, though wage growth is decelerating, which could impact consumer spending power.
The recent movements in USDCAD, with a 0.07% rise to 1.37560, could be influenced by the differences in economic indicators between the U.S. and Canada. Despite the U.S. facing stagnant inflationary pressures and a dip in consumer sentiment, Canada’s labor market shows a robust job addition. Still, it is tempered by declining wage growth. These factors may result in increased volatility for USDCAD as markets react to mixed economic signals from both countries. Upcoming high-impact economic events, particularly Canada’s inflation rate and U.S. unemployment claims, could introduce further shifts. Typically, stronger Canadian economic data relative to the U.S. could put downward pressure on USDCAD, while better U.S. data could elevate it, subject to market interpretations of future central bank actions based on global economic health assessments.
From X (Twitter)
Employment rose by 47,000 (+0.2%) in September 2024 while the employment rate declined 0.1 percentage points to 60.7%.
The unemployment rate fell 0.1 percentage points to 6.5%.
For more info: https://t.co/KCP3xqFtQc. pic.twitter.com/VRYoNqKYYy
— Statistics Canada (@StatCan_eng) October 11, 2024
What can we expect from USDCAD for the new week and what happened on Friday?
USDCAD on Friday rose 0.07% to 1.38. Price is above 9-Day EMA while Stochastic is rising in overbought zone. For the week ending 2024-10-11, the pair rose 1.36% or 185 pips higher.
Looking ahead, USDCAD looks mixed as the pair is likely to consolidate above week low of 1.36.
For the new week, our technical outlook looks bullish, immediate upside resistance level at 1.39 (WR1) with break above could target 1.40 (WR2). On the downside, we are looking at week low of 1.36 as an important support. Break below this level could weaken the current bullish momentum. A break above 1.38 would suggest bullish bias after recent positive movement.
For the month of October, USDCAD is up by 1.69% or 228.8 pips higher.
Weekly key levels to watch out:
| R3 | 1.42 |
| R2 | 1.40 |
| R1 | 1.39 |
| Weekly Pivot | 1.37 |
| S1 | 1.36 |
| S2 | 1.34 |
| S3 | 1.32 |
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