US Dollar recovery vs JPY and CAD intact post-Employment report

Chris Lee

  • The US Dollar produce positive gains after the early October US Employment report, despite the far lower than anticipated NFP data, buoyed by higher than expected average hourly earnings.
  • This keeps the risk for a continuing strengthening for the US currency into October as seen from September with a more hawkish tone from the FOMC and Fed speakers.
  • For USDJPY and USDCAD this leaves risk for further challenges to resistance.

USDJPY – Upside threat

A spike higher Friday through resistance at 113.26 reinforcing the early October solid consolidation, and despite the intraday setback whilst still holding above the 112.23/13 support area, we see risk higher again for Monday.

Furthermore, the latter September push through 112.20 produced a bullish shift in the intermediate-term outlook and indicates upside risk into October.

For Today:

l We see an upside bias for 113.44; break here aims for 113.58, then maybe 113.74.

l But below the 112.23/13 area opens risk down to 111.45, maybe down to 111.10.

Intermediate-term Outlook – Upside Risks:

l We see a positive tone with the bullish threat to 114.50

l Above here targets 115.50/63 and maybe towards 118.65.

What Changes This? Below 111.88 signals a neutral tone, only shifting negative below 111.10.

4 Hour USDJPY Chart


USDCAD – Upside threats

A dip lower seen as corrective on Friday, but whilst holding above 1.2500 we see a rebound threat into Monday.

Furthermore, risk is still growing for a shift in the intermediate-term bearish view to neutral, but only above 1.2663, And even as high as 1.2778, which would see an intermediate term bullish switch.

For Today:

l We see an upside bias back up to 1.2599, maybe as high as our key level at 1.2663, even 1.2691.

l But below 1.2500 opens risk down to 1.2465 .

Intermediate-term Outlook – Downside Risks:

l Whilst below 1.2663, we see a negative tone with the bearish threat to targets 1.2000 and 1.1919.

What Changes This? Above 1.2663 signals a neutral tone, only shifting positive above 1.2778.

Daily USDCAD Chart