To end this trading week, today’s chart of the day features the Euro / Canadian Dollar pairing.
Since the beginning of the week, EURCAD has remained within a relatively tight trading range with the weekly pivot point figure of 1.46792 acting as a firm level of resistance. After the bulls have tested this area several times and failed, it may be suggestive of a continuation to the overall downtrend during the upcoming sessions.
However, according to the longer-term (weekly) time frame, the pair found convincing levels of support around the 1.45 region this time last year and rebounded from this point. Perhaps this plus the recent formation of an indecisive candle on the most recent high (July 18th) is the main attributing factor for the latest range-bound activity, with both short-term and long-term traders undecided on the directional bias.
So which direction can gather more momentum? As the Euro is tied up in political turmoil, the Canadian Dollar may find demand in the form of appreciating oil markets. With recent military tensions building up along the Iranian borders, it could spark a supply issue for the commodity and in-turn the Canadian Dollar is a potential benefactor in this scenario.
As, yet again, we approach another re-test of the weekly pivot, it will be interesting to see how this pair progresses during the upcoming sessions.
Sources: Go Markets, Meta Trader 5, TradingView, Bloomberg
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