USD/CAD starts week with gains

The week has started with strong gains for USD/CAD. In Monday’s North American session, USD/CAD is trading at 1.3293, up 0.67% on the day.

Canada core retail sales decline 

The week ended on a sour note for Canadian releases. Core retail sales declined by 0.4%, down from 15.7% beforehand. This figure missed the estimate of 0.5%. The headline reading slowed to 0.6%, down sharply from 23.7%.  The weak numbers followed a shocker from ADP nonfarm payrolls, which indicated that the economy shed 205.4 thousand jobs in August. This soft reading comes after a sparkling reading of 1.14 million in the previous release. Investors did not appear to be troubled by the weak numbers, as the Canadian dollar held its own against the greenback last week.

There are no tier-1 Canadian events this week, so we can expect US releases to have a magnified impact on USD/CAD. Later in the week, the US releases Manufacturing and Services PMIs.

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USD/CAD Technical

• USD/CAD broke above resistance at 1.3257 in the European session. This is followed by resistance at 1.3312
• 1.3138 is the first line of support. Below, there is support at 1.3074
• USD/CAD pushed above the 10-day MA on Friday, which is a sign of an upward trend

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