Current trend

During the Asian session, the USD/CAD pair shows ambiguous trading dynamics, consolidating near 1.3650: the quotes were actively declining on Friday when the focus of investors was on October reports on the labor markets of the United States and Canada.

Thus, nonfarm payrolls adjusted from 297.0K to 150.0K, worse than analysts’ expectations of 180.0K, the unemployment rate accelerated from 3.8% to 3.9%, and average wages showed signs of slowing. The Canadian report also was poor: the change in the number of employees dropped from 63.8K to 17.5K, with a forecast of 22.5K. The average hourly wage adjusted from 5.3% to 5.0%, and the unemployment rate – from 5.5% to 5.7%, ahead of analysts’ preliminary estimates of 5.6%.

Investors’ focus Monday will be on the Ivey Canadian PMI for October, which is expected to move from 54.2 points to 53.7 points in October after falling from 56.8 points to 54.2 points earlier. A survey of large American banks on lending dynamics for the third quarter, conducted by the US Federal Reserve, will also be published.

Support and resistance

On the daily chart, Bollinger Bands are trying to turn down: the price range is expanding from below, clearing the way for the bears to new local lows. The MACD indicator is declining, maintaining a strong sell signal (the histogram is below the signal line). Stochastic maintains a confident downward direction but is near the lows, indicating that the US currency may become oversold in the ultra-short term.

Resistance levels: 1.3700, 1.3750, 1.3800, 1.3853.

Support levels: 1.3650, 1.3600, 1.3550, 1.3500.

Trading tips

Short positions may be opened after a confident level of 1.3650 downwards with the target at 1.3550. Stop loss – 1.3700. Implementation time: 1–2 days.

Long positions may be opened after a rebound from 1.3650 and a breakdown of 1.3700 upwards with the target at 1.3800. Stop loss – 1.3650.