The EUR/CAD pair fell drastically during the course of the session on Thursday, but also the Wednesday session. With that being the case, the market looks as if we are pulling back from some of the overbought conditions that we have seen over the last week or so. That being the case, the market should continue to go higher over the longer term though, as this pullback was just simply a reaction to overextended conditions. I cannot help but notice that the 1.4750 level offered support, and that of course is an area that offered resistance quite some time ago. With this, we bounced off that level and it looks like we’re going to try to find support in this general vicinity.
This was a bit of a perfect storm though, because the Euro fell significantly during the session against most currencies, while the Canadian dollar strengthen due to a positive move in the oil markets. However, the markets will have to put up with quite a bit of volatility in general as although this pair tends to be very straightforward, the truth of the matter is there is a lot of volatility in the commodity markets and that of course can heavily influence what happens in the currency markets.
Buying only
As I am only buying this pair though, I certainly wouldn’t sell it as we are most certainly in an uptrend. We had a nice, strong, stable move higher previously, and as a result it looks that we are going to continue to grind given enough time to the upside. With a bit of perseverance, there are profits to be had as I believe the market will then reach towards the 1.55 level, and then much higher than that. That will be especially true if the EUR/USD pair goes much higher, as the Euro will be the more traded currency of the 2 worldwide.
