In the US, manufacturing activity grew at a slower pace in April, as the ISM Manufacturing PMI dropped to 60.7, down from 64.7. It was a similar story for business activity, as the ISM Services PMI slowed to 62.7, down from 63.7. Both PMIs missed their estimates.
The market was ready to celebrate a massive nonfarm payroll report for April, with an estimate of 990 thousand. Some analysts had even predicted a print of two million, but in the end, the economy created just 266 thousand jobs. Unemployment rose to 6.1%, up from 5.8% and above the estimate of 6.0%. There was a silver lining, as wage growth climbed 0.7%, rebounding from -0.1% and above the forecast of 0.0%.
- Manufacturing Sales: Friday, 12:30. Manufacturing sales took a downturn in February, with a read of -1.6%. Will we see an improvement in the March data?
Technical lines from top to bottom:
We start with resistance at 1.2446 (mentioned last week).
1.2350 is next.
1.2210 has switched to resistance after sharp losses by USD/CAD last week.
1.2125 is an immediate resistance line.
1.1985 is providing support.
1.1765 is the final support line for now.
I am bullish on USD/CAD
Canada’s weak job numbers last week are an indication that the recovery from Covid is not nearly complete, and this could curb appetite for the Canadian dollar.
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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/CAD forecast – Canadian dollar predictions.
- Forex+ weekly forecast – Outlook for the major events of the week.
Safe Trading!