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. 

Disclaimer: The XM Group entities provide execution-only service and access to our Online Trading Facility, permitting a person to view and/or use the content available on or via the website, is not intended to change or expand on this, nor does it change or expand on this. Such access and use are always subject to: (i) Terms and Conditions; (ii) Risk Warnings; and (iii) Full Disclaimer. Such content is therefore provided as no more than general information. Particularly, please be aware that the contents of our Online Trading Facility are neither a solicitation, nor an offer to enter any transactions on the financial markets. Trading on any financial market involves a significant level of risk to your capital.

All material published on our Online Trading Facility is intended for educational/informational purposes only, and does not contain – nor should it be considered as containing – financial, investment tax or trading advice and recommendations; or a record of our trading prices; or an offer of, or solicitation for, a transaction in any financial instruments; or unsolicited financial promotions to you.

Any third-party content, as well as content prepared by XM, such as: opinions, news, research, analyses, prices and other information or links to third-party sites contained on this website are provided on an “as-is” basis, as general market commentary, and do not constitute investment advice. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, it would be considered as marketing communication under the relevant laws and regulations. Please ensure that you have read and understood our Notification on Non-Independent Investment. Research and Risk Warning concerning the foregoing information, which can be accessed here.

We are using cookies to give you the best experience on our website. Read more or change your cookie settings.

Risk Warning: Your capital is at risk. Leveraged products may not be suitable for everyone. Please consider our Risk Disclosure.