Canadian Dollar steady against mixed US data

• Canadian Dollar rises slightly against US Dollar following mixed economic data.
• Soft US GDP growth and strong ADP Employment Change figure support the USD in Wednesday session.
• NFP expectations point to a decline in payrolls due to hurricanes and Boeing strike, potentially weakening USD.

The USD/CAD pair trades neutrally on Wednesday near 1.3915. The Canadian Dollar is gaining some ground against its US counterpart despite mixed economic data from the US. Softer Gross Domestic Product (GDP) growth than expected from Q3 and a strong ADP Employment Change report for October are moving the markets in Wednesday’s session.

However, Tuesday’s declining JOLTS Job Openings and expectations of a Federal Reserve (Fed) rate cut have weighed on the US Dollar. The release of the PCE Prices Index and Nonfarm Payrolls (NFP) report later this week is expected to provide further direction to the USD/CAD pair amidst ongoing market volatility.

Daily digest market movers: Canadian Dollar on neutral ground after US data

• Strong October ADP employment data (233K vs. 115K expected) strengthens the US Dollar against the Canadian Dollar.
• Q3 US GDP growth of 2.8% falls short of expectations but remains robust in the context of a global economic slowdown. The market had expected 3.0%.
• JOLTS report on Tuesday showed a decline in job openings in September, raising concerns about the labor market and pressuring the US Dollar.
• Futures markets now fully price in a 25 bps interest rate cut by the Fed next week with chances of a further cut in December easing.
• Personal Consumption Expenditures (PCE) Prices Index expected to show continued easing of price pressures on Thursday.
• NFP report on Friday expected to show a significant decline in new payrolls, potentially weighing on the US Dollar.
• Bloomberg consensus for October NFP is 110K vs. September's 254K and a whisper number of 127k.

USD/CAD technical outlook: Bullish momentum remains, strong resistance at 1.3920

The Loonie’s Relative Strength Index (RSI) is in the deep overbought area at a value of 75 with a mildly declining slope, suggesting that buying pressure is easing. Also, the Moving Average Convergence Divergence (MACD) is flat and green, suggesting that buying pressure is at least neutral.

Buyers will potentially take a breather in the next session and use the 1.3900 support to consolidate the Aussie trade in the next few sessions.