It looks like EUR/CAD
established an uptrend moving towards high highs and higher lows. The confirmation
of the uptrend could be a breakout of the 61.8% Fibonacci retracement level
applied to a high hit on January 30 and a low hit back on April 17.
However, the pair broke below the ascending channel and at the same time crossed 50 moving average. EUR/CAD seems to be in a correctional phase where the rate should
move lower. The Fibonacci, applied to the channel breakout point shows two
potential target levels. The first is S1 (1.3713) and second is S2 (1.3608). The S2 looks much more reasonable target as
its not only 23.6% level of the channel breakout Fibs, but also 38.2% of the
major Fibs retracement mentioned earlier.
Consider selling EUR/CAD
anywhere between the current level and R1 (1.3800) targeting at S2 (1.3608). Keep
in mind that this is only a correctional move and in the longer term the rate is
likely to continue its growth.
Support: 1.3713, 1.3608
Resistance: 1.3800, 1.3884
The material has been provided by InstaForex Company – www.instaforex.com