🎈 Up Big Today: Find today's biggest gainers with our free screenerTry Stock Screener

EUR/CAD Could Be In For A Sizable Move, Tests Key Level

Published 10/01/2018, 05:52
EUR/CAD
-

The EUR/CAD is an interesting FX pair to watch as it is currently testing a key technical area in the 100-pip range between 1.4735 and 1.4835.

Why is this area so significant? Firstly because it was the last noticeable low prior to the rally in early December, which ultimately failed to sustain itself. Thus, if the buyers lose control of this zone then this would only boost the bears’ control. In addition, we have a number of other technical indicators which also converge in this zone, too. These include a bullish trend line, the 200-day moving average and the 38.2% Fibonacci retracement level of last year’s range.

So, if last year’s break above a key resistance at 1.5260 marked a break in market structure then the bulls would like to see the rally resume from here i.e. the 1.4735-1.4835 range. However, if support here breaks down then last year’s breakout above that 1.5260 level can be confirmed as a false move, which is a reversal pattern. So, given the importance of this 1.4735-1.4835 area, we could see a significant move once we know who comes out on top: the bulls or the bears?

A potential break below the abovementioned support range could see price drop sharply towards the 50.0 or 61.6 percent retracement levels next, at 1.4578 and 1.3990 respectively. Meanwhile resistance comes in at 1.4880 and 1.5000, levels which were previously support. If price breaks above these levels then the bulls would want to see a subsequent move above this year’s opening level at 1.5090. This potential scenario would be bullish, in which case we may see a subsequent rally to and possibly beyond last year’s high at 1.5270ish.

EURCAD Daily Chart

Disclaimer: The information on this web site is not targeted at the general public of any particular country. It is not intended for distribution to residents in any country where such distribution or use would contravene any local law or regulatory requirement. The information and opinions in this report are for general information use only and are not intended as an offer or solicitation with respect to the purchase or sale of any currency or CFD contract. All opinions and information contained in this report are subject to change without notice. This report has been prepared without regard to the specific investment objectives, financial situation and needs of any particular recipient. Any references to historical price movements or levels is informational based on our analysis and we do not represent or warranty that any such movements or levels are likely to reoccur in the future. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness, nor does author assume any liability for any direct, indirect or consequential loss that may result from the reliance by any person upon any such information or opinions.

Original post

Latest comments

Loading next article…
Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.