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.
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.
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