Current trend

The USD/CAD pair is showing a moderate decline, extending the "bearish" momentum formed last week when the instrument retreated from its all-time highs from March 24. Quotes are testing the level of 1.3660 for a breakdown, waiting for new drivers to appear on the market. At the same time, analysts continue to evaluate reports from the US and Canada on the labor market, published on Friday.

Thus, in September, the American economy created 336.0 thousand new jobs after 227.0 thousand in the previous month, while analysts expected 170.0 thousand, and the Unemployment Rate remained at 3.8% with a forecast of 3.7%. Average Hourly Earnings added 0.2% in monthly terms, while experts expected 0.3%, and in annual terms the figure slowed down from 4.3% to 4.2% with neutral forecasts.

The Canadian report was more uniform: the Employment Change added 63.8 thousand after an increase of 39.9 thousand in the previous month, while analysts expected 20.0 thousand. The Unemployment Rate remained at 5.5%, contrary to forecasts of 5.6%, and the Average Hourly Wages accelerated from 5.2% to 5.3%.

Support and resistance

Bollinger Bands in D1 chart show active growth. The price range is slightly narrowed from below, remaining spacious enough for the current market activity. MACD indicator tries to reverse downwards, having formed a new sell signal (the histogram is about to consolidate below the signal line). Stochastic is showing a more active decline being located in the middle of its area.

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 breakdown of 1.3600 with the target at 1.3500. Stop-loss — 1.3650. Implementation time: 2-3 days.

The return of the "bullish" trend with the breakout of 1.3700 may become a signal for new purchases with the target of 1.3800. Stop-loss — 1.3650.