USDCAD on Friday rose 0.94% to 1.41540. Week ending 2024-12-06 rose 1.01%. What happened.

USDCAD Analysis

Performance
Period	Pct	Chg	Momentum
Friday	0.94%	132.5 Pips
Week 2024-12-06	1.01%	141.4 Pips
December	1.05%	146.8 Pips

Upcoming key events for the new week (London Time)

Wed 01:30 PM CPI Inflation Rate (12-mth)
Wed 02:45 PM Bank of Canada Policy Interest Rate
Thu 01:30 PM Initial Unemployment Insurance Claims
Thu 01:30 PM PPI excluding Food and Energy sectors (12-mth)

What happened over the week

In the United States, the University of Michigan reported a slight decline in the Index of Consumer Expectations from 3.2% in November to 3.1% in December. However, consumer sentiment showed a positive shift, increasing from 71.8 points in November to 74 points in December. According to the Bureau of Labor Statistics, average hourly earnings in the U.S. for November showed a robust annual increase of 4%, though monthly gains remained stagnant at 0.4%. Nonfarm payroll employment experienced a notable rise to 227,000 jobs in November, significantly higher than the revised 36,000 seen in October, while the unemployment rate edged up slightly from 4.1% to 4.2%. The Department of Labor reported a rise in initial unemployment claims to 224,000 by the end of November. Additionally, U.S. new orders for manufactured goods exhibited growth, rising by 0.2% in October after a decline in the previous month.

In Canada, Statistics Canada disclosed that the unemployment rate climbed to 6.8% in November, up from 6.5% in the preceding month. Despite this rise in unemployment, Canada saw an increase in net employment by 50,500 jobs in November, a significant improvement over October’s figure of 14,500. However, average hourly wages in Canada for the 12-month period contracted to 3.9% in November, down from October’s 4.9%, indicating potential wage pressures amidst the rising unemployment.

The USDCAD exchange rate’s upward movement to 1.41540, an increase of 0.94% on Friday and 1.01% for the week ending December 6, indicates a stronger U.S. dollar against the Canadian dollar. The mixed economic data from both countries, with robust U.S. payrolls and earnings contrasted against Canada’s rising unemployment and falling wage growth, supports this currency pair’s trajectory. Anticipated high-impact economic events such as the U.S. CPI inflation rate release could further influence market expectations and volatility. Additionally, the Bank of Canada’s policy interest rate announcement is of high significance and can drive currency fluctuations. These upcoming events are poised to influence the USDCAD exchange rate, potentially favoring U.S. dollar strength if U.S. economic indicators outperform Canadian ones or if the Bank of Canada’s policy stance remains accommodative.

From X (Twitter)

#Employment increased by 51,000 (+0.2%) in November 2024 and the employment rate held steady at 60.6%. pic.twitter.com/75nrYKkbqn

— Statistics Canada (@StatCan_eng) December 6, 2024

What can we expect from USDCAD for the new week and what happened on Friday?

USDCAD on Friday rose 0.94% to 1.42. Price is above 9-Day EMA while Stochastic is falling. For the week ending 2024-12-06, the pair rose 1.01% or 141.4 pips higher.

Looking ahead, USDCAD looks mixed as the pair is likely to consolidate above week low of 1.40.

For the new week, our technical outlook is mixed. To see upside interest, we prefer to look at price breakout of week high of 1.42 or at least consolidates above Weekly Pivot level of 1.41. On the downside, we are looking at week low 1.40 or 1.41 (WS1) as immediate support level. USDCAD need to break on either side to indicate a short-term bias. A break above 1.42 would suggest bullish bias after recent positive movement.

For the month of December, USDCAD is up by 1.05% or 146.8 pips higher.

Weekly key levels to watch out:

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