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Important: I use New York close charts so that each 24-hour period closes at 5 pm EST.
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Two weeks ago on April 16 I mentioned how I favored EURCAD shorts below 1.5690. The pair was coming off of ascending channel resistance at 1.6150 and looked poised to continue lower but not before a retest of 1.5690 as new resistance.
That retest occurred between the 23rd and 25th of April. The latter formed a bearish outside day, suggesting an influx of selling pressure in the area.
Since the April 13 low, the EURCAD has also carved an ascending channel. It’s evident on the daily time frame, but the 4-hour chart offers a much clearer picture. Given the recent declines from 1.6150, I’m labeling this a bearish continuation pattern.
At the moment, the pair has broken below channel support on a 4-hour closing basis. We’ll have to wait until 5 pm EST to see whether sellers can also close today’s session below support near 1.5550.
Remember, I use New York close charts where each 24-hour session closes at 5 pm EST.
If sellers can clear the 1.5550 support area on a daily closing basis, I’d expect sellers to defend the level as new resistance. The next key support comes in at 1.5370/80. A close below that would expose ascending channel support that extends from the 2017 low.
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