• USDCAD takes offers to refresh intraday low, snapping six-day uptrend.
• Cautious optimism in the market joins firmer oil prices, US dollar pullback to tease pair sellers.
• Fed versus BOC play can keep bulls hopeful even if the US jobs report fail to impress DXY buyers.

USDCAD cheers the broad US dollar pullback, as well as a mildly positive market mood, as it prints the first intraday loss in seven. That said, the Loonie pair takes offers to refresh the daily low near 1.3680 during early Friday morning in Europe.

That said, the US Dollar Index (DXY) retreats from a fortnight high to pare the biggest weekly gain in seven, refreshing intraday low around 112.60 by the press time.

The greenback’s latest losses could be linked to the hopes of witnessing positive news surrounding the Russia-Ukraine tussles as leaders from Germany and China meet. Also, the People’s Bank of China’s (PBOC) efforts to defend the Chinese Yuan (CNY) join the pre-data consolidation to add strength to the risk-on mood.

It should be noted that the firmer prices of the Crude Oil, Canada’s main export item, also weigh on the USDCAD of late. WTI crude oil rises 1.25% intraday to $88.45 at the latest.

Alternatively, the hawkish plays of the US Federal Reserve (Fed) contrast with the Bank of Canada’s (BOC) easy rate hike to favor buyers. Also, strong yields and fears of an economic slowdown are extra catalysts keeping the USDCAD bulls hopeful.

Amid these plays, the US stock futures print mild gains and the yields remain firmer whereas the Asia-Pacific equities print notable gains led by China.

Moving on, the employment data from the US and Canada will be crucial for the USDCAD pair traders to watch and might help the recent sellers to keep the reins amid downbeat market consensus for the US numbers. Forecasts suggest that the headline US NFP could ease to 200K in October from 263K prior while the US Unemployment Rate may increase to 3.6% from 3.5% prior. On the other hand, Canada’s Net Change in Employment may also ease to 10K versus 21.1K prior with the Unemployment Rate likely witnessing an uptick to 5.3% from 5.2% prior.

Even so, the Fed versus the BOC game is in the favor of the USDCAD bulls and hence any pullback could be considered non-lucrative for sellers.

Technical analysis

USDCAD retreats from a six-week-old horizontal resistance, around 1.3825-10, but the downside remains elusive unless the quote stays beyond a convergence of the 50-DMA and lows marked since late October, close to 1.3500.