The Canadian dollar is unchanged in Friday trade. Currently, USD/CAD is trading at 1.3176, down 0.01% on the day.
Ahead – Canadian, US Employment Reports
Traders should be prepared for some volatility from the Canadian dollar in the North American session, as Canada and the U.S. both release key job numbers. After a rare decline in employment change, the economy is expected to show a gain of 10.0 thousand jobs in November. The unemployment rate is expected to remain pegged at 5.5 percent. Over in the U.S., investors are expecting strong numbers. Nonfarm payrolls are projected to increase sharply to 181 thousand in November, compared to 128 thousand in the previous release. As well, wage growth is expected to rise from 0.2% to 0.3%.
Higher Oil Prices Boost Canadian Dollar
Higher oil prices have boosted the Canadian dollar this week. Crude jumped 3.6% on Wednesday, after an unexpectedly strong drawdown in crude inventories. As well, OPEC members have gathered for a crucial meeting, and there is speculation that the cartel may cut production in order to reduce a glut of oil on world markets. West Texas Intermediate has climbed 7.1% since November 1, and a reduction in output by OPEC would likely push WTI above $60 a barrel.
USD/CAD has broken below support at the 1.3200 line. Below, we find support at 1.3125, which last saw action in the first week of November. On the upside, 1.3200 has switched to resistance and is a weak line. The 50-EMA and 200-EMA follow, with the 50-EMA at 1.3236 and the 200-EMA is at 1.3239. If the 50-EMA crosses above the 200-EMA, it would be a bullish sign for the pair (“golden cross”).
EUR/GBP is trading sideways in the Friday session. Currently, the pair is trading at 0.8445, up 0.08% on the day. The pair shrugged off a weak German manufacturing report. German Industrial Production declined by 1.7% in September, marking a second straight decline. Analysts had expected a small gain of 0.1%.
EUR/GBP is within striking distance of support at 0.8400. This major level has held since May 2017, so a breakout below this line would be a major development. On the upside, there is resistance at 0.8500.
This article was originally posted on FX Empire
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