Current trend

The USD/CAD pair is correcting at 1.3775 due to the strengthening of the American dollar.

The Canadian dollar remains under pressure despite the positive September macroeconomic statistics. The unemployment rate fell from 6.6% to 6.5%, exceeding the forecast of 6.7%, and employment increased from 22.1K to 46.7K against 29.8K, while the full figure grew from –43.6K to 112.0K. Nevertheless, the share of the economically active population decreased from 65.1% to 64.9%, the lowest since November 2022.

The American dollar is trading at 102.80 in the USDX. Investors positively assessed the September producer price index, unchanged after growing by 0.2% MoM and slowed from 1.9% to 1.8% YoY. This indicator measures inflation for suppliers of goods and services, significantly affecting the US Fed interest rate decisions. Due to its decrease, experts’ confidence in the correctness of the “dovish” monetary policy course increases.

Support and resistance

On the daily chart, the trading instrument is correcting within the ascending channel with dynamic boundaries of 1.4100–1.3700.

Technical indicators strengthen the buy signal: the EMA fluctuation range on the Alligator indicator is expanding, and the fast EMAs are moving away from each other. The AO histogram is forming correction bars above the transition level, moving away from it.

Resistance levels: 1.3820, 1.3950.

Support levels: 1.3740, 1.3610.

Trading tips

Long positions may be opened after the price rises and consolidates above 1.3820, with the target at 1.3950. Stop loss — 1.3750. Implementation period: 7 days or more.

Short positions may be opened after the price falls and consolidates below 1.3740, with the target at 1.3610. Stop loss — 1.3800.