Important: I use New York close charts so that each 24-hour period closes at 5 pm EST.
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To say the EURCAD has been uneventful of late would be an understatement. Since closing below the 1.5440 area on June 27th, the Euro cross has gone nowhere fast.
For the last 19 trading days, prices have been contained by a 125 pip range. Support is found at 1.5315 with resistance coming in between 1.5440.
However, if we strip away the horizontal levels, we can see that a pattern has started to develop since the July 4th low.
Notice that this short-term ascending channel comes on the back of an aggressive 300 pip selloff in late June. And if we view the last 19 days as corrective price action, it would suggest that the next impulsive move will be lower.
That’s the view I’m going with for now. There’s no guarantee it will happen, but given the break below the larger ascending channel in late June and the recent sideways price action, it seems this latest ascending formation is a continuation pattern.
So does that mean you should sell the EURCAD today?
Probably not. Of course, it’s your decision, but until the pair closes below the 1.5315 area, there’s too much guesswork involved to justify an entry in my opinion.
I remain short from the June 22nd retest of ascending channel resistance at 1.5580. I posted this entry in the member’s area shortly after I entered last month.
I’m open to the idea of adding to the position, but not until sellers force a close below 1.5315. Until that time the EURCAD is range bound.
A close below 1.5315 would expose 1.5150 followed by the 1.5000 handle. Alternatively, a close above the short-term ascending channel resistance near 1.5480 would turn our attention higher toward the June highs at 1.5580.
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