EUR/CAD is testing a major support zone after falling sharply earlier this month!
Think the pair is poised to extend a longer-term uptrend?
Here’s what we’re seeing on the 4-hour time frame:
EUR/CAD 4-hour Forex Chart by TradingView
Political and fiscal uncertainty in France limited the demand for the euro earlier this week, dragging the common currency lower against its major counterparts.
On the flip side, the Canadian dollar is getting some support from a recovery in U.S. dollar demand and higher crude oil prices.
Remember that directional biases and volatility conditions in market price are typically driven by fundamentals. If you haven’t yet done your homework on the euro and the Canadian dollar, then it’s time to check out the economic calendar and stay updated on daily fundamental news!
EUR/CAD, which has been printing higher highs and higher lows since August, recently turned lower from the 1.6400 psychological handle and is now hovering near the 1.6225 inflection point.
Note that the pair’s current levels also align with both the 200 SMA and the lower edge of its ascending channel pattern.
If we start seeing green candlesticks and steady demand above 1.6250, trend followers could jump back in and drive prices toward the 1.6400 highs or even fresh 2025 highs.
But if this October slide extends, the pair could slip under the 1.6200 psychological mark and threaten a break below trend support. In that case, EUR/CAD might revisit previous areas of interest around 1.6100 or even 1.6000.
Whichever bias you end up trading, don’t forget to practice proper risk management and stay aware of top-tier catalysts that could influence overall market sentiment!
Disclaimer:
Please be aware that the technical analysis content provided herein is for informational and educational purposes only. It should not be construed as trading advice or a suggestion of any specific directional bias. Technical analysis is just one aspect of a comprehensive trading strategy. The technical setups discussed are intended to highlight potential areas of interest that other traders may be observing. Ultimately, all trading decisions, risk management strategies, and their resulting outcomes are the sole responsibility of each individual trader. Please trade responsibly.
