Yesterday I mentioned how CADJPY could come under pressure soon.
If it does, EURCAD could benefit from Canadian dollar weakness. It would be well timed too given how the pair is retesting a trend line I discussed last December.
You may recall the bullish break in early December 2018.
After a week of retesting former resistance as new support near 1.5100, EURCAD reached our 500 pip target at 1.5580.
Since that time, however, sellers have been in complete control.
EURCAD has nearly wiped out all of December’s gains. But that isn’t surprising given how volatile Canadian dollar crosses such as EURCAD can be.
Bullish price action from the 1.4970 area would suggest the pair is ready to move higher again.
Alternatively, a daily close below the 2018 trend line would indicate the opposite.
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As for key resistance, I would keep an eye on the 1.5180 area followed by 1.5320.
I won’t trade EURCAD without bullish price action such as a pin bar. Without it, there’s no clear indication that buyers are ready to step in at 1.4970.
As a side note, the price action in 2019 has been relatively unfavorable in my opinion.
There haven’t been many quality opportunities thus far, so an extra dose of patience is required here.
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