EUR/CAD slips slightly in early Tuesday trading but holds above major support. Bulls eye 1.6000 breakout while consolidation remains likely.
The Euro to Canadian Dollar (EUR/CAD) pair is trading slightly lower around 1.5925 during Tuesday’s early European session. A fresh uptick in crude oil prices has bolstered the Canadian Dollar (CAD), dragging the cross off recent highs. As traders await new PMI data from the Eurozone and Germany, the pair appears to be consolidating ahead of a potential directional move.
🔍 Technical Overview: Neutral Momentum Within Bullish Structure
Despite the minor pullback, the overall structure for EUR/CAD remains bullish, as long as the price stays above the 100-day Exponential Moving Average (EMA) on the daily chart. The Relative Strength Index (RSI) hovers near the 50 level, suggesting a lack of clear momentum in the short term and favoring a period of sideways action.
🔺 Resistance Levels to Watch
- 1.6000 – A psychological and technical barrier. A break above this level could accelerate bullish momentum.
- 1.6100 – Marks the upper edge of the Bollinger Band and represents a round resistance level.
- 1.6125 – The high from July 28, serving as the next key level for bullish continuation.
A strong close above 1.6000 may validate further upside, pushing the pair into higher resistance zones and strengthening the bullish case.
🔻 Support Zones in Focus
- 1.5888 – The low from July 17, acting as the first line of support on the downside.
- 1.5810 – Corresponds to the lower band of the Bollinger channel, offering additional downside protection.
- 1.5720 – The 100-day EMA level, considered a crucial support to maintain the broader bullish bias.
A break below 1.5888 could expose the cross to deeper losses, with 1.5810 and 1.5720 acting as the next likely targets for bears.
📊 Outlook: Consolidation Likely Before Next Breakout
While the EUR/CAD pair remains technically supported, current price action points to a neutral near-term bias as traders digest recent economic signals. Attention now shifts to Eurozone and German Services and Composite PMI data for July, which may provide fresh volatility and direction for the pair.
Unless key support at 1.5888 breaks, the bullish trend remains intact, with a clean move above 1.6000 required to open the door for further upside.
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