USD/CAD Eyes November-Low (1.2666) Ahead of BoC Rate Decision

Talking Points:

USD/CAD Eyes November-Low (1.2666) Ahead of BoC Rate Decision.

EUR/USD Clings to Narrow Range Ahead of U.S. Non-Farm Payrolls (NFP) Report.

DailyFX TableUSD/CAD

USD/CAD gives behind a allege from progressing this week as Canada combined a towering 79.5K jobs in November, with a 3Q Gross Domestic Product (GDP) news violence marketplace expectations, and a span might vaunt a some-more bearish function over a near-term should a Bank of Canada (BoC) uncover a incomparable eagerness to serve normalize financial process in 2018.

Even yet a BoC is mostly expected to keep a stream process during a final 2017 seductiveness rate preference on Dec 6, a executive bank might strike a some-more hawkish tinge as a ongoing alleviation in a labor marketplace pushes a Unemployment Rate down to an annualized 5.9%, a lowest reading given 2008. In turn, Governor Stephen Poloz and Co. might ready Canadian households and businesses for aloft borrowing-costs as ‘less financial process impulse will expected be compulsory over time.’

With that said, USD/CAD might bluster a range-bound cost movement carried over from Nov as it outlines another unsuccessful try to exam a pivotal former-support section around1.2980 (61.8% retracement) to 1.3030 (50% expansion), with a span confronting a flourishing risk of giving behind a miscarry from a 2017-low (1.2061) as a bear-flag appears to be holding shape.

USD/CAD Daily Chart

USD/CAD Daily Chart

  • A pierce subsequent 1.2720 (38.2% retracement) might coax a exam of a November-low (1.2670), with a subsequent downside aim entrance in around 1.2620 (50% retracement), that sits subsequent a 50-Day SMA (1.2655).
  • Keeping a tighten eye on a Relative Strength Index (RSI) as it pulls behind forward of overbought domain and approaches trendline support; might see a bearish RSI trigger manifest over a days forward should a oscillator snap a ceiling trend from August.


EUR/USD might continue to connect following a singular greeting to a below-forecast ISM Manufacturing consult as a span preserves a range-bounce cost movement from progressing this week.

The monthly opening operation for EUR/USD is in concentration as a U.S. Non-Farm Payrolls (NFP) news is expected to uncover a economy adding another 200K jobs in November, while Average Hourly Earnings are projected to boost an annualized 2.7% after expanding 2.4% in October. A serve alleviation in labor marketplace dynamics accompanied by signs of stronger salary enlargement might criticise a near-term resilience in a euro-dollar sell rate as a Federal Open Market Committee (FOMC) appears to be on march to broach a Dec rate-hike.

However, another collection of churned information prints might criticise a Fed’s range to exercise aloft borrowing-costs in 2018, and marketplace participants might compensate increasing courtesy to a updated projections entrance out of a executive bank amid a arriving revolution within a FOMC.

EUR/USD Daily Chart

EUR/USD Daily Chart

  • Topside targets sojourn on a radar for EUR/USD as it binds above a former-resistance section around 1.1810 (61.8% retracement) to 1.1860 (161.8% expansion), with a break/close above 1.1960 (38.2% retracement) jump lifting a risk for a run during a 2017-high (1.2092).
  • Next segment of seductiveness entrance in around 1.2130 (50% retracement) followed by a 1.2230 (50% retracement) region.
  • May see a incomparable liberation reveal as both cost and a Relative Strength Index (RSI) mangle out of a bearish formations from September, though need to closely watch a oscillator as it clings to trendline support, with a unsuccessful try to mangle above 70 lifting a risk for range-bound prices.

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