Daily Forex News and Watchlist: USD/CAD

Uncle Sam is about to print its latest NFP report!

Think the release will affect USD/CAD’s short-term downtrend?

Before moving on, ICYMI, yesterday’s watchlist checked out GBP/USD’s 1-hour range amidst worsening tensions between Russia and Ukraine. Be sure to check out if it’s still a valid play!

And now for the headlines that rocked the markets in the last trading sessions:

Fresh Market Headlines & Economic Data:

Fed Chair Powell: Ukraine-Russia conflict could drive U.S. inflation higher

U.S. ISM services PMI falls to 56.5 in Feb vs. 61.0 expected, 59.9 in Jan

U.S. factory orders up by 1.4% in Jan vs. 0.7% gain in Dec

BOC Gov. Macklem: There is “considerable space” to raise rates this year, not ruling out a 50-basis point hike

Macklem: Quantitative Tightening (QT) a “natural step” after rate hike

Japan’s unemployment rate up from 2.7% to 2.8% in Jan as COVID wave prompted restrictions

AU retail sales rebound from 4.4% drop in Dec to 1.8% gain (the second-highest increase on record) in Jan

Russian forces shell nuclear plant in Ukraine

Asia stocks tumble to 16-month lows after Ukraine nuclear complex fire

German exports (+7.5%) rose at a slower pace than imports (+22.1%) in Jan

France’s industrial production up by 1.6% vs. 0.6% expected in Jan

Upcoming Potential Catalysts on the Forex Economic Calendar:

Eurozone retail sales at 10:00 am GMT
U.S. NFP reports at 1:30 pm GMT
Canada’s building permits at 1:30 pm GMT
Canada’s IVEY PMI at 3:00 pm GMT

Use our new Currency Heat Map to quickly see a visual overview of the forex market’s price action! 🔥 🗺️

What to Watch: USD/CAD

European currencies dropped like they were hot earlier today when the Zaporizhzhia Nuclear Power Plant – Europe’s largest power station – got shelled by Russian forces enough to start fires in the complex.

EUR and GBP took the biggest hits but CAD also saw some intraday losses while traders flocked to safe-havens like USD and JPY.

Will today’s U.S. session reports affect USD/CAD? Uncle Sam is printing the non-farm payrolls (NFP) report for February.

Analysts expect the economy to show a net gain of 400K for the month. The jobless rate could improve from 4.0% to 3.9% but could also slow down from 0.7% to 0.5%.

A better-than-expected NFP release would rekindle talks of a more aggressive FOMC rate hike in March. Recall that expectations of a 50-basis point hike diminished after Chairman Powell shared his concerns over the Russia-Ukraine crisis.

USD/CAD could bust above its descending channel. The 1.2750 zone near the 200 SMA could be a good target but it will depend on the bullish momentum of the potential breakout.

If the NFP report disappoints, or if traders are encouraged to take risks during the U.S. session, then USD/CAD could extend its downtrend.

Those who are dollar bearish can take advantage of USD/CAD finding resistance at its current levels and revisiting its March lows.