EUR/CAD Price Analysis: Bears picking up discounts on a fade on rallies
- EUR/CAD bears seeking downside extension to daily demand area.
- Discounts are being handed out to the bears as they test bullish commitments.
Regarding the prior analysis, EUR/CAD Price Analysis: Bears seek a break of hourly support, the bears got what they wished for in a fade on rallies.
Prior analysis
EUR/CAD's upside correction has been capped by a significant Fibonacci level and the focus remains firmly on the downside.
The following is a top-down analysis that illustrates the bias.
Daily chart
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The daily chart's trajectory is south which raises prospects of a short opportunity from the lower time frames.
1-hour chart
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From a 1-hour perspective, the current support structure offers a faster entry point to target the downside from a restest of the support that would be expected to act as resistance.
Momentum is bearish and the price is well below the 21-SMA.
Live market, 1-hour chart
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As illustrated, the price has since melted to the downside and bears indeed were able to capitalize on a restest of the prior support structure for a discount on the short side.
The price has again offered a discount from fresh lows to a 38.2% Fibonacci retracement that meets prior spike lows, a confluence that would be expected to now act as resistance.
That being said, slightly higher up, in line with a 61.8% Fibo, a deeper correction to the higher structure will offer a better discount in seeking a downside extension to the daily demand area between 1.4750 and 1.4695.
Author
Ross J Burland
FXStreet
Ross J Burland, born in England, UK, is a sportsman at heart. He played Rugby and Judo for his county, Kent and the South East of England Rugby team.
