Dukascopy Bank Team
Dukascopy Bank SA
EUR/CAD 1H Chart: Channel Up
Comment: EUR/CAD bottomed out on May 26, being unable to pierce through support at 1.3430, which has been proving its significance throughout May. As a result, the currency pair is now forming a bullish channel, and the technical indicators reinforce the positive bias. In the short term the exchange rate may fall, but the dip should be limited by 1.3570, where the daily S1 merges with the 200-hour SMA and up-trend. The target is the upper boundary of the pattern at 1.3720, but the bulls will have to push through a potentially dangerous resistance level at 1.3675. Meanwhile, the sentiment is moderately positive, since 59% of open positions are long and the remaining 41% are short.
EUR/USD 1H Chart: Channel Down
Comment: The bullish run we have been observing for the past two days should come to an end. EUR/USD has just come into contact with resistance at 1.0975, which is created by the May 28 high and, more importantly, by the falling trend-line. Accordingly, the present risks are heavily skewed to the downside. The initial target is the May 27 low at 1.0820 (also daily S2 and weekly S1), followed by the Apr 21 low and the lower trend-line at 1.0660. Alternatively, if 1.0975 does not withstand the buying pressure, the 200-hour SMA will likely have to come into play and stop the rally. However, the sentiment of the SWFX market is neutral, being that 48% of open positions are long and 52% are short.
This overview can be used only for informational purposes. Dukascopy SA is not responsible for any losses arising from any investment based on any recommendation, forecast or other information herein contained.
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