Daily Forex Review: CAD Loses Ground on Weak Jobs Report

Daily Forex Review: CAD Loses Ground on Weak Jobs Report

The US dollar regained ground against most of its major forex counterparts last Friday as risk aversion stayed in the markets, on the heels of the banking issue in Portugal from the previous day. There have been no reports released from the US economy then, yet the dollar benefitted from the safe-haven flows. There are still no reports due from the US economy today, which suggests that risk sentiment might keep driving price action for the rest of the trading sessions.

The euro edged slightly lower on Friday, even as traders booked profits off their euro short positions. German final CPI came in line with expectations of a 0.3% uptick while the wholesale price index showed weak results, as it reflected a 0.1% decline and hinted at weaker inflation prospects down the line. Euro zone industrial production and a speech by ECB head Draghi are lined up for today.


Forex Review and Updates

The pound continued to consolidate to most of its major forex counterparts in recent trading, as traders await more clues from the UK economy and the BOE. UK construction output was weaker than expected as it slipped by 1.1% instead of showing the estimated 0.8% gain. There are no reports lined up from the UK today.

The franc still showed signs of weakness towards the end of the forex trading week, as there were no reports released from Switzerland to give its currency any support. There are still no reports due from Switzerland today, which suggests that the franc might take its cue from the euro or follow risk sentiment.

The yen moved mostly sideways on the end of the forex trading week as there were no reports from Japan and not much updates on risk sentiment during the Asian trading sessions. Despite relatively bleak figures so far, the currency continues to draw support from weak risk appetite. There are no reports due from Japan today.

The Loonie suffered a massive selloff on last Friday’s US forex trading session when Canada printed a very weak employment report. Instead of showing the estimated 20.7K increase in hiring, the economy reported a 9.4K drop. The jobless rate also climbed from 7.0% to 7.1% even as the participation rate remained unchanged. There are no reports due from the comdoll economies today so risk flows might dictate price action.

To contact the reporter of the story: James Brennan at james@forexminute.com

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Samuel Rae is an active retail trader across a variety of assets, including currencies, stocks and commodities and the author of Diary of a Currency Trader (Harriman House). His personal strategy focuses primarily on classical technical charting patterns with a fundamentally supportive bias, combined with a strict, risk management-driven approach to entries and exits. He is an Economics graduate from Manchester University, UK.