USD/CAD Forecast 09/11: Dollar Rallies On Jobs Data (Video)

(MENAFN- Daily Forex) The U.S. dollar jumped after the employment numbers in the US came out hotter than anticipated. Adding to the momentum, Canadian employment was a big miss. The interest rate differential continues to favor the USA.

USD/CAD

The U.S. dollar has rallied quite nicely against the Canadian dollar during the trading session here on Friday, as the jobs report coming out of the United States showed Americans adding 165,000 jobs last month instead of the expected 65,000.

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Conversely, the Canadians found themselves struggling, as Canada lost 4,500 jobs instead of the expected addition of 14,600 jobs. This is a complete reversal in both economies, and the interest rate differential should continue to favor the U.S. dollar going forward. A weakening U.S. economy would have been needed for further selling pressure because, quite frankly, the Federal Reserve is likely to continue to have to tighten monetary policy.

If the market were to rally from here, it's likely that we could go looking towards the 1.4250 level. A short-term pullback opens up the possibility of the 200-day EMA being tested. It is at the 61.8% Fibonacci retracement level, which hangs out right around the 1.3950 level. You get paid to hang on to this pair, and I suspect you're going to get paid more soon.

EURUSD Chart by TradingView

So, that's what the market will be watching. Nice candlestick on Friday, and look at each dip as a potential buying opportunity. If we break above the top of the candlestick, then I think that's the sign that momentum is picking up to the upside

This is a market that continues to see a lot of carry trade possibilities, and as a result, this is a market that will attract a lot of buy-the-dip traders, and should continue to look at this market in that vein.

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