The EUR/CAD pair initially try to fall during the session on the day, but as you can see broke back above the 1.45 handle. This of course is a very positive sign, and it should be noted that a massive uptrend line did in fact market higher. With this, it’s very likely that the market should continue to go higher, but it won’t necessarily be the easiest move. Obviously, we have saliva rather drastically lately, but the EUR/USD pair is also showing a significant amount of support, so I feel that the Euro could bounce from here in general.
On a move higher, I believe that a break above the 1.46 level since this market to the 1.50 level, which of course is a massively resistant area as it is without a doubt a large, round, psychologically significant number of the largest order.
This could be a simple matter of Europe versus North America.
I think that this market could in fact be showing the sentiment of Europe versus North America. The Euro has been sold off drastically lately, so it makes sense that perhaps there could be a significant bounce. This balance could easily go to the 1.50 level, but I also have to question whether or not the uptrend simply stays intact, and we eventually go to the 1.55 handle and beyond. If that’s the case, this could be a massive buying opportunity of the largest order, as the magnitude of the pullback has been fairly significant.
On the other hand, if we do break down below the 1.44 level, I believe that this market could continue to drop to the 1.40 handle as it would be a significant break all of an uptrend line. With that being the case, the market would in fact be “broken”, and I think that at that point in time the Euro could start to fall against most currencies around the world. I don’t necessarily see that happening, and as a result the German Export numbers the, later today couldn’t in fact be a catalyst to push this market higher.