USD/CAD rises towards resistance ahead of key macro events

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The USD/CAD pair faces a potentially volatile week due to major economic data releases from the US and Canada. Key events include:

1. US Data Releases: Critical reports like the ISM Manufacturing PMI, JOLTS job openings, and Friday’s August jobs report will influence the U.S. dollar. A strong jobs report could stabilize the dollar, while weaker data may lead to further declines.

2. Bank of Canada Rate Decision: The Bank of Canada is expected to cut rates by 25 basis points on Wednesday, following previous cuts. With Canada’s labor market showing signs of cooling, further monetary easing seems likely. However, a strong jobs report could boost the Canadian dollar despite the rate cut.

Technical Outlook:

The USD/CAD recently dropped sharply, but it is now rebounding towards a critical resistance zone at 1.3570-1.3600. A move above this zone is needed to turn the tide; otherwise, the path of least resistance on this pair remains to the downside.


By Fawad Razaqzada, market analyst at FOREX.com