There aren’t too many economic releases scheduled for today but those that will be published are certainly worth attention. Namely, both Canada and the United States will release labour market data for September at 1:30 pm BST today.
Of course, it is the US report (NFP) that will be the most closely watched, mostly because of its impact on future Fed policy. The US central bank said during its latest meeting that should the economy continue to develop as expected, a taper announcement will come soon. Markets believe that strong NFP reading today will cement the decision to officially announce tapering of asset purchases during the Fed’s meeting in November. Having said that, beat in today’s US jobs numbers may see the US dollar strengthen. When it comes to Canadian report, the market expects weaker job creation than last month and a drop of unemployment rate below 7.0%.
As both reports will be released at the same time, volatility on the USDCAD is expected to be elevated near the release hour. A look at the pair shows us that it has recently dropped below the upward trendline and the 1.2620 price zone. The near-term support to watch in case of a continuation of a downward move can be found ranging between 1.2500 mark and the 50% retracement of the upward impulse launched in June 2021 (1.2475). The area is additionally strengthened by previous price reactions as well as 200-session moving average (purple line). Near-term resistance zone is ranging around the 1.2620 mark.