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Fan Yang

EUR/CAD in a Bullish Continuation Breakout

EUR/CAD has been developing a bullish trend in 2017. However, it retreated in June-July from a high around 1.5250 to about 1.45. Now, we are seeing price rebound and breaking the bearish channel formed in June-July.

EUR/CAD Daily Chart

(click to enlarge)

Bullish Breakout and Other Signals:
- The daily chart shows price breaking above the falling channel from June and July.
- Also note that price essentially tested the 200- and 100-day simple moving averages (SMA) and treated the cluster as support.
- This is a bullish signal, just like it was in April when price broke above the SMA cluster than bounced off of it as support.
- Now, note the RSI, which hung around/above 40 for a while but is now moving up from it. 
- This reflects maintenance of the prevailing bullish momentum, just it did in April when the RSI rebounded around 40. 
- With this bullish continuation signal, there is upside first towards 1.50, and likely 1.52, which is where I would limit the bullish expectation for now because the overall market since 2016 has been sideways and even slightly bearish.

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