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Ugly Canadian Jobs Data Gives USD/CAD a Bullish Reversal

CAN employment change (Apr): -28.9K
Forecast: 12.8K
Previous: 42.9K

CAN unemployment rate (Apr): 6.9%
Forecast: 6.9%
Previous: 6.9%

Instead of adding jobs in April, Canada's economy shed 28.9K of them. While the reading for March was much better than expected, April's reading was much worse than. In fact looking back I see a lot of forecast way off. 

(click to see full size)

In this chart from, economists' median forecasts are the yellow lines, while the blue bars show the actual reading. In any case, whether you gave much credibility to the forecast or not, the actual reading is undoubtedly ugly. 

The USD/CAD has been bearish since retreating from the 2014 high of 1.1277. After stalling at 1.0813, the Canadian jobs data pressured the loonie, and the USD/CAD reversed. It is trading around 1.09 as the US session gets underway.

(usdcad 4h chart, 5/9)

Fundamental and Technical Factors:
Also note that the oscillators in the 4h chart were oversold and are now being resolved by this rally. The oscillators in the daily chart are also oversold and starting to be resolved.

Both fundamentals and technical conditions can be attributed to the current "reversal".

However, if price fails to push above 1.0935, and the falling trendline, the technical outlook remains bearish and the current reversal would have just been a brief correction to a developing medium-term bearish correction.

Let's look at the daily chart:

(usdcad daily chart, 5/9)

Resistance, breakout scenario:
I believe a break above 1.10 will be needed to convince traders USD/CAD is technically bullish in the 4H, and daily time-frame. This first opens up to 
1) 1.1050 (50 and 100 daily SMAs around here), then 
2) 1.1150 (common resistance) and 
3) 1.1277  (2014-high)

Otherwise, a "Meaningful Bearish Correction" is still in the cards.

For the bearish scenario, the 1.08-1.0815 will include key support factors. Below 1.08, the 1.0740 level is the next pivot to monitor, as you can see in the daily chart.