The Canadian dollar climbed 2.5% last week, as USD/CAD fell to its lowest level since early March. There are three releases in the upcoming week, all of minor significance. Here is an outlook at the highlights and an updated technical analysis for USD/CAD. The Bank of Canada maintained interest rates at 0.25% for a third successive month, as expected. Policymakers noted that financial conditions have started to improve, as the country is slowly recovering from the Covid-19 outbreak. This was the first policy meeting under new BOC Governor Tiff Macklem, who replaces Stephen Poloz. Canada’s trade deficit jumped to C$3.3 billion in April, up from C$ 1.4 billion beforehand. It was the highest deficit recorded since January 2019. The economy added 289.6 thousand jobs in May, after shedding 1.99 million a month earlier. Analysts had predicted a loss of 500 thousand jobs. The unemployment rate climbed to 13.7%, up from 13% beforehand. Still, this was better than the estimate of 15.0 percent. Elsewhere, Ivey PMI improved to 39.1, up from 22.8 and beating the forecast of 30.8 points. In the U.S., ISM Manufacturing PMI improved to 43.1, up from 41.1 beforehand. The PMI has now pointed to contraction for three straight months, as the manufacturing sector has been hit hard by the economic crisis. The services sector also finds itself in contraction territory, as the ISM Non-Manufacturing PMI came in at 45.4 in May within expectations. Nonfarm payrolls shocked with a huge gain of 2.5 million in May, defying the estimate of -7.7 million. In April, the economy shed a staggering 20.5 million jobs. The unemployment rate fell to 13.3%, down from 14.7% beforehand. The forecast stood at 19.4 percent. USD/CAD daily chart with support and resistance lines on it. Click to enlarge: Housing Starts: Monday, 12:15. Housing starts is an important gauge of the strength of the housing sector. The indicator slipped to 171 thousand in April, its lowest level since January 2016. Will we see a rebound in the May release? Corporate Profits: Tuesday, 12:30. Canadian corporations enjoyed a strong increase of 3.6% in profits during Q4 of 2019, marking a third consecutive quarterly expansion. We now await the Q1 data. Capacity Utilization Rate: Friday, 12:30. This quarterly measure of the industry provides the Bank of Canada with insights on the level of slack in the economy. Utilization has been fluctuating slightly above the 80- level in recent releases. USD/CAD Technical Analysis Technical lines from top to bottom: With USD/CAD recording sharp losses, we start at lower levels: 1.3757 switched to resistance early in the week. 1.3661 (mentioned last week) is next. 1.3550 had been in a support role since early March, but switched to resistance after strong gains by USD/CAD last week. 1.3420 is fluid, as USD/CAD ended the week just shy of this level. 1.3330 is providing support. 1.3265 is next. 1.3150 is the final support level for now. I am neutral on USD/CAD The outlook for the Canadian economy is not rosy, but the Canadian dollar has showed surprising resilience, with gains of 4.5% since April 1. Last week’s employment numbers were strong on both sides of the border, a sign that both the U.S. and Canada are seeing stronger economic conditions. Follow us on Sticher or iTunes Further reading: EUR/USD forecast – for everything related to the euro. GBP/USD forecast – Pound/dollar projections. AUD/USD forecast – analysis for the Aussie dollar. USD/JPY forecast – analysis for dollar/yen Forex+ weekly forecast – Outlook for the major events of the week. Safe trading! Kenny Fisher Kenny Fisher Kenny Fisher - Senior Writer A native of Toronto, Canada, Kenneth worked for seven years in the marketing and trading departments at Bendix, a foreign exchange company in Toronto. Kenneth is also a lawyer, and has extensive experience as an editor and writer. Kenny's Google Profile View All Post By Kenny Fisher Expert score 5 Etoro - Best For Beginner & Experts0% Commission and No stamp DutyRegulated by US,UK & International StockCopy Successfull Traders 5 Read Review Open My Free Account Your capital is at risk. Canadian Dollar ForecastMinorsWeekly Forex Forecasts share Read Next OPEC+ agrees to extend oil output cuts by one month, until end-July FX Street 1 year The Canadian dollar climbed 2.5% last week, as USD/CAD fell to its lowest level since early March. There are three releases in the upcoming week, all of minor significance. Here is an outlook at the highlights and an updated technical analysis for USD/CAD. The Bank of Canada maintained interest rates at 0.25% for a third successive month, as expected. Policymakers noted that financial conditions have started to improve, as the country is slowly recovering from the Covid-19 outbreak. This was the first policy meeting under new BOC Governor Tiff Macklem, who replaces Stephen Poloz. 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