USD/CAD Price Forecast: Trades strongly ahead of US/Canada employment data

The Canadian Dollar (CAD) faces a significant selling pressure against the US Dollar (USD) on Friday. In the European trade, USD/CAD pair is up 0.45% higher to near 1.4073.

The Loonie pair strengthens as the US Dollar outperforms ahead of the United States (US) Nonfarm Payrolls (NFP) data for October, which will be published at 13:30 GMT.

As of writing, the US Dollar Index (DXY), which gauges the Greenback’s value against six major currencies, trades 0.35% higher to near 101.95. The USD Index strengthens as its safe-haven demand has improved due to global Artificial Intelligence (AI) rout.

TD sees subdued US jobs growth but flags upside risks

According to TD Securities, October US nonfarm payrolls are likely to remain soft, with economists looking for headline jobs growth to come in at “40k after job gains moderated to 29k in September.” The bank notes that, “despite the subdued, below-consensus print, our forecast would be within the range of breakeven job gains and result in an increase in the three-month moving average.” At the same time, TD stresses that “risks to our payrolls forecast are to the upside,” suggesting the eventual outcome could exceed their baseline call.

Investors also await the Canadian labor market data for October, which will be published alongside the US NFP data.

Canadian employers are expected to have hired 13.6K fresh workers after firing 68.3K employees in September. The Unemployment Rate is seen as steady at 6.5%.

USD/CAD Technical Analysis

In the four-hour chart, USD/CAD trades at 1.4071, maintaining a bullish near-term bias as price holds above the 20-period exponential moving average (EMA) at 1.4000 and above the key Fibonacci retracements at 1.4017 (50.0%) and 1.3950 (61.8%). The Relative Strength Index (14) has pushed into overbought territory near 71.6, suggesting the latest advance could be stretched even as the broader structure remains supported on dips.

On the topside, initial resistance emerges at the 38.2% Fibonacci retracement at 1.4084, with further barriers at the 23.6% level at 1.4167 and the recent Fibonacci anchor higher near 1.4302 if bullish momentum extends. On the downside, immediate support is seen at the 50.0% retracement at 1.4017, followed closely by the 20-period EMA at 1.4000; a deeper pullback would expose the 61.8% retracement at 1.3950, while the 1.3733 Fibonacci base represents a more distant structural floor.