EUR/CAD Price Forecast: Bullish continuation pattern forming
- EUR/CAD is tipped to go higher if a bullish continuation pattern completes.
- The price pattern is enhanced by the ADX indicator rising strongly above 20.
- EUR/CAD could reach 1.5000 and beyond if it continues bullish momentum.
EUR/CAD is rising strongly as diverging interest-rate expectations favor the Euro (EUR) over the Canadian Dollar (CAD).
The pair is trading at about 1.4950 at the time of writing and is forming a continuation price pattern (shaded blue rectangle) which – should it complete – could forecast probable higher prices to come.
EUR/CAD Daily Chart
Assuming that Wednesday’s close is above 1.4930 and the day ends as a bullish green candle, the pattern will be confirmed.
The Average Directional Indicator (ADX) is used to assess the strength of the trend and it is rising at above 20 further confirming the likelihood of the bull trend continuing.
If the pattern completes – as looks highly likely – the pair will probably rise to roughly 1.5000, where it will encounter resistance from the dark gray trendline. A break above the day’s highs would serve as confirmation.
It is also possible it could continue even higher to the resistance line at 1.5040.
A decline below 1.4839, however, would invalidate the pattern.
Author
Joaquin Monfort
FXStreet
Joaquin Monfort is a financial writer and analyst with over 10 years experience writing about financial markets and alt data. He holds a degree in Anthropology from London University and a Diploma in Technical analysis.
