Trade of the Day: EUR/CAD

By: Dima Chernovolov

EUR/CAD continues to rise inside the hourly Up Channel chart pattern which was recently identified by Autochartist. Autochartist rates the quality of this Up Channel at the 4-bar level – which is the result of the slow Initial Trend (1 bar), low Uniformity (2 bars) and strong Clarity (8 bars). EUR/CAD is expected to rise further inside this Up Channel in line with the earlier breakout of the resistance area shown below.

As can be seen from the daily EUR/CAD chart below – the price earlier broke through the resistance area lying between the key resistance level 1.5530 (monthly top from May) and the 50% Fibonacci retracement of the downward correction from March. This price zone is acting as the support area after it was broken.  The proximity of this support area adds to the probability EUR/CAD will continue to rise inside this Up Channel.