As the first Friday of a new month has come, it is time for the release of jobs data from the United States (1:30 pm BST). NFP report for July is a key macro event of the day. While the report is always closely followed by market participants, this time it is even more important as Fed Chair Powell said that a strong labor market supports further monetary policy tightening. Jobless claims have been on the rise since April and should employment growth slow, the thesis of a strong labor market may be put under question. Market expects a job gain of 250k, what would be the smallest increase since December 2020. Wage growth is expected to slow from 5.1% YoY to 4.9% YoY.
USDCAD is expected to be volatile around release time as Canadian jobs data will also be released at 1:30 pm BST. In the case of Canada, the market expects an employment increase of 19.8k and an increase in the unemployment rate from 4.9 to 5.0%.
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Taking a look at USDCAD chart at D1 interval, we can see that the pair managed to halt recent correction at the support zone ranging above 1.2760 mark. The pair has been trading in an upward channel for over a year and as such mid-term technical outlook is more supportive for bulls. In case the pair extends current upward impulse, the first resistance to watch can be found at 38.2% retracement of the post-pandemic downward move (1.3020 area).