Suggestion for trade

Sell @ upper trendline channel (currently 1.4657), stop loss 1.4677, Targets 1.4555 and 1.4200

Buy @ break and daily close above upper trendline channel (currently 1.4657), stop loss 1.4637, target 1.4820

EUR/CAD is being traded in rising wedge formation since last two months, but now it seems that a breakout might be in play very soon as the wedge has become too squeezed and bulls may attempt to reach 1.4827 which is 50% fib level + monthly 200 MA, however, research shows that Rising Wedge Formation ends at downside breakout in 69% cases, so a bounce off from upper trendline channel can also be a possibility, negative divergence of MACD on four hour time frame also confirms this case.

Major Support & Resistance Levels

At the moment of writing the pair is being traded at 1.4638 during Asian session and is likely to face a strong hurdle around 1.4657 (Channel Resistance), a break and close above this level may help pair find new buyers thus accelerating the ongoing bullish trend, a breakout shall open doors for 1.4827.

On downside, the pair may find support around 1.4600 to 1.4610 area (psychological Level + Hourly 55 and 100 MA) ahead of 1.4535 to 1.4550 region (channel support + 55 MA on 4 hour timeframe), a break and close below this level may push EUR/CAD into bearish trend targeting 1.4437 and 1.4272.

Technical Indicators

As we mentioned earlier that MACD is showing negative divergence on four hour chart suggesting a bounce back from upper trendline channel is the most likely case. Relative Strength Index (RSI) is also in overbought territory showing a reading of 75. Bollinger bands are showing resistance exactly at upper trendline channel (on hourly timeframe), thus all three indicators are in favor of bounce back from upper trendline channel.

Trade over 50 forex markets 24 hours a day with FXOpen. Take advantage of low commissions, deep liquidity, and spreads from 0.0 pips. Open your FXOpen account now or learn more about trading forex with FXOpen.

This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.