USDCAD attempting to regain 1.3500 after hitting six-week lows at 1.3470


  • The US dollar plunges 2.5% on Friday to hit six-week lows at 1.3470.
  • A mixed NFP report sends the greenback tumbling.
  • USDCAD is testing the neckline of a potential H&S formation.

The US dollar is about to close its worst daily performance in some months with a nearly 1.8% sell-off. The pair has extended its reversal from Thursday’s high at 1.3800 to levels below 1.3500 for the first time since late September.


A mixed employment report has hammered the US dollar

 The US Non-Farm Payrolls report has shown a 261K increase in October, beating expectations of 200K, and September’s figures have been revised up to 315K, from the previously estimated 4 K.

The unemployment rate, however, has risen to 3.7% from 3.5% in September, above the consensus 3.6%, while hourly earnings increased 4,7% in October from 5% in September. These figures suggest that labor market conditions might be easing, which has tamed expectations of further aggressive rate hikes by the Fed.

The US dollar, which had been surging since Wednesday, after US Fed President, Jeremy Powell, reiterated the need for further monetary tightening, dropped like a stone on Friday on the first signs that the bank’s monetary policy could be starting to take effect.

USDCAD is testing support at 1.3500

The daily chart shows the pair reaching the area where the neckline of a Head And Shoulders formation meets the 50-day SMA, at 1.3500.

A clear breach of that area would activate the H&S pattern, and could push the pair towards 1.3200 (September 1 and 7 highs and the100-day SMA) and then probably the 1.3000 psychological level.

USDCAD daily chart

USDCAD daily chart

Technical levels to watch

USD/CAD

Overview
Today last price 1.3509
Today Daily Change -0.0237
Today Daily Change % -1.72
Today daily open 1.3746
 
Trends
Daily SMA20 1.3707
Daily SMA50 1.3486
Daily SMA100 1.3201
Daily SMA200 1.2958
 
Levels
Previous Daily High 1.3808
Previous Daily Low 1.3683
Previous Weekly High 1.3774
Previous Weekly Low 1.3496
Previous Monthly High 1.3978
Previous Monthly Low 1.3496
Daily Fibonacci 38.2% 1.376
Daily Fibonacci 61.8% 1.3731
Daily Pivot Point S1 1.3683
Daily Pivot Point S2 1.362
Daily Pivot Point S3 1.3557
Daily Pivot Point R1 1.3809
Daily Pivot Point R2 1.3871
Daily Pivot Point R3 1.3934

 

 

 

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