USD/CAD Climbs Following Fed Testimony and Risk-off Mood

The dollar moves higher to 1.274 against the Canadian dollar as the risk-off mood will counter the effect of the rate hike. US benchmark yields become firmer, with the 10-year yield increasing to 1.84%. Brent crude prices surged 6% to $111.59 a barrel. Rate hikes will likely start in March despite geopolitical uncertainty. He will probably do a 25-basis point cut, and the Fed will reduce its balance sheet.

Technical Analysis

The USD/CAD recovered against the Loonie. Support is seen near the 10-day moving average near 1.267. Resistance is seen near the downward sloping trend line near 1.275. Short-term momentum is negative as the fast stochastic generated a crossover sell signal. The reading prints 41.02. 

Medium-term momentum turned positive as the MACD (moving average convergence divergence) index generated a crossover buy signal. The MACD line (the 12-day moving average minus the 26-day moving average) converges to the MACD signal line (the 9-day moving average of the MACD line). The MACD histogram is printing in positive territory with an upward sloping trajectory.

ADP Private Sector Jobs Estimate Beats Expectations in February

Private companies in the US added 475,000 jobs in February, beating expectations. The Dow Jones estimate was 400,000. The reading indicates stronger job gains for the month and shows the positive sentiment in the labor market. The slowdown in Omicron contributed to the overall improved economic situation. The leisure and hospitality sector made most of the month’s hiring gains.