USD/CAD has taken quite a plunge in the aftermath of the upbeat U.S. jobs report on Friday, and continues to break key support levels, looking increasingly bearish.

The pair is now at levels not seen since mid-August, and rapidly recuperating some of the gains from recent weeks. At this stage, the momentum is clearly south, and with both the U.S. and Canada closed for Labour Day, the technicals are firmly in control of the pair. Look for Tuesday’s Bank of Canada rate decision for more direction. Not everyone is convinced the central bank will hike rates, so a hike should weaken the pair even further.

Hourly candles of CAD/JPY are coming into a triangle formation, with both ascending and descending trend lines ruling the pair, which suggests a sharp break in either direction could be imminent.

The Canadian dollar is one of those currencies which generally outperforms the USD on better than expected U.S. data. For this reason, CAD/JPY is a good pair to trade nonfarm payrolls on, because the pip movements are likely to be more pronounced than in USD/JPY, and the direction, identical. If payrolls come in better than expected, look for the pair to head higher. The reverse is also true. Movements could be aggravated once the triangle breaks.

NZD/USD is the day’s top performer, playing catch-up after the solid gains in the Australian dollar on Wednesday. The interesting things here is that the 50-hour moving average (green) is about to pass the 100-hour average (blue) suggesting that more bullishness could be in the cards. Lookout, however. The RSI at 67 is nearly at overbought levels (at or above 70).

As with the Aussie dollar, much of the day’s trading will revolve around positioning for nonfarm payrolls from the U.S. on Friday. These days, upbeat economic data for the U.S. strengthens the kiwi dollar, and vice-versa.