Technical Analysis – EURCAD accelerates to 3-week high; bias cautiously positive
EURCAD is set to close strongly bullish after three consecutive negative weeks, with the pair accelerating from a three-year low of 1.4262 to three-week highs.
Looking at the four-hour chart, the RSI’s position provides some cautious signals as the indicator is already above its 70 overbought mark, though it has yet to show signs of weakness, suggesting that there might be some extra room for improvement in the market.
Moving higher, the bulls should overcome the former 1.4596 resistance level to reach the 78.6% Fibonacci of 1.4620 of the 1.4718-1.4262 downleg. Beyond the latter, the next target could be the 1.4686 barrier.
Should sellers return to the game, the 61.8% Fibonacci at 1.4544 could act as immediate support before attention shifts back to the 200-period simple moving average (SMA), which has flattened around the 50% Fibonacci of 1.4490. Breaching the latter, the area between the 20-period SMA and the 38.2% Fibonacci of 1.4436 could next take control as it did earlier in the week.
In short, EURCAD could experience more upside pressure, though not for long as the market is already trading in overbought waters.
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