USD/CAD holds fairly well against a strong US Nonfarm Payrolls and disappointing Canadian jobs report. That said, economists at TD Securities think the pair is in the midst of forming a higher base, and a topside break above key resistance at 1.3080 is inevitable.

Disappointing jobs number does not do the CAD any favors

“A disappointing jobs number does not do the CAD any favors, particularly against a much stronger payrolls report in the US. The data mix is supportive of a higher USD/CAD, but we are not convinced that it will break the 1.3080 resistance in the near-term. More dominoes need to fall before that happens. But make no mistake, it will.”

“We think USD/CAD is forming a higher base, and we believe that holding risk into US inflation and the Fed's Index of Common Inflation Expectations (CIE) next week is playing with fire (US CPI is expected to be as strong as the last report while the CIE likely rose).”

“We are long USD/CAD and target 1.35.”

See – Canadian dollar: Forecasts from five major banks, best G10 currency only means modest recovery