Forex trader eagerly await today’s NFP report out of the US. October’s data was soft, and earlier this week, the ADP private-sector employment report disappointed. Economic data out of the US has been soft all week, and the USDCAD entered a sell-off. Consumer confidence data will also be released, and consumer credit data will be anticipated as the holiday shopping season is underway. What impact will this have on price action? Follow the PaxForex Daily Forex Technical Analysis and grow your balance trade-by-trade.
The Canadian employment report will be released today as well. Canada’s central bank kept interest rates unchanged at 1.75% earlier this week. How will today’s employment data factor into the sell-off in the USDCAD? Will Canadian Dollar bulls receive a strong employment report and push this currency pair to the downside, or will bears get a chance to step in? Today’s fundamental analysis will take a look at the upside potential as well as the downside risk in this currency pair.
Here are the key factors to keep in mind today for US Dollar trades:
- US NFP Report: The US NFP Report for November is predicted to show 186K job additions, and an unemployment rate of 3.6%. Forex traders can compare this to the US NFP Report for October which showed 128K job additions, and an unemployment rate of 3.6%. Private Payrolls for November are predicted to show 175K job additions and Manufacturing Payrolls 38K job additions. Forex traders can compare this to Private Payrolls for October which showed 131K job additions and Manufacturing Payrolls which showed 36K job losses. The Average Work Week for November is predicted at 34.4 hours. Forex traders can compare this to the Average Work Week for October which was reported at 34.4 hours. Average Hourly Earnings for November are predicted to increase by 0.3% monthly, and by 3.0% annualized. Forex traders can compare this to Average Hourly Earnings for October were increased by 0.2% monthly, and by 3.0% annualized. The Labor Force Participation Rate for November is predicted at 63.3%. Forex traders can compare this to the Labor Force Participation Rate for October which was reported at 63.3%.
- US Michigan Consumer Sentiment: Preliminary US Michigan Consumer Sentiment for December is predicted at 97.0. Forex traders can compare this to US Michigan Consumer Confidence for November which was reported at 96.8. Preliminary Current Conditions for December are expected at 112.4 and Preliminary Expectations are predicted at 88.0. Forex traders can compare this to Current Conditions for November which were reported at 111.6 and to Expectations which were reported at 87.3.
- US Wholesale Inventories: US Final Wholesale Inventories for October are predicted to increase by 0.2% monthly. Forex traders can compare this to US Wholesale Inventories for September which decreased 0.4% monthly.
- US Consumer Credit: US Consumer Credit for October is predicted at $16.000B. Forex traders can compare this to US Consumer Credit for September which was reported at $9.513B.
Here is the key factor to keep in mind today for Canadian Dollar trades:
- Canadian Employment Report: The Canadian Employment Report for November is predicted to show the addition of 10.0K jobs and an Unemployment Rate of 5.5%. Forex traders can compare this to the Canadian Employment Report for October which showed the loss of 1.8K jobs and an Unemployment Rate of 5.5%. Hourly Earnings for Permanent Employees for November are predicted to increase by 4.5% annualized. Forex traders can compare this to Hourly Earnings for Permanent Employees for October which increased by 4.4% annualized. 10.0K Full-Time Positions and 15.0K Part-Time Positions are expected to have been created in November. Forex traders can compare this to the loss of 16.1K Full-Time Positions and to the creation of 14.3K Part-Time Positions which were reported in October. The Labor Force Participation Rate for November is expected at 65.7%. Forex traders can compare this to the Labor Force Participation Rate for October which was reported at 65.7%.
Should price action for the USDCAD remain inside the or breakdown below the 1.3160 to 1.3200 zone the following trade set-up is recommended:
- Timeframe: D1
- Recommendation: Short Position
- Entry Level: Short Position @ 1.3180
- Take Profit Zone: 1.3000 – 1.3040
- Stop Loss Level: 1.3220
Should price action for the USDCAD breakout above 1.3200 the following trade set-up is recommended:
- Timeframe: D1
- Recommendation: Long Position
- Entry Level: Long Position @ 1.3220
- Take Profit Zone: 1.3300 – 1.3325
- Stop Loss Level: 1.3180
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