EURCAD Hits Target- Long Scalps Eye 1.4457 Resistance

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Talking Points

• EURCAD targets key resistance range 1.4444/57

• Scalp bias constructive above 1.4330- bullish invalidation

• Event risk on tap this week

EUR/CAD Daily Chart

Chart Created Using FXCM Marketscope 2.0

Technical Outlook

• EURCAD testing key resistance confluence 1.4444/57- bearish invalidation

• Breach targets resistance objectives at 1.4613 & 1.4724/33

• Interim support 1.4363/83, ~Former Channel Resistance- bullish invalidation

• Key support still 1.4012/53

• Daily RSI trigger breaks / highest momentum read since March- constructive

• RSI 60-breach would be bullish

• Event Risk Ahead: Canadian Retail Sales & Bank of Canada Rate Decision on Wednesday, Eurozone PMI on Thursday

EUR/CAD 30min Chart

Notes: On October 1st we noted that the EURCAD was coming into key support at the 1.4053 support level with our topside bias in-play while above that key region. The pair subsequently rallied through the September opening range before finding resistance at our final topside objective at 1.4444 last week. The focus remains on this key resistance range which we will now extend into 1.4457 to respect the 61.8% retracement of the August decline. A breach of this region is needed to maintain our topside scalp bias with such a scenario eyeing subsequent resistance objectives and completing what looks to be a five wave advance off the monthly low.

Bottom line: we’ll favor buying dips while above Friday’s low (1.4425/30) with a breach through o1.4444/58 (close basis) offering further validation for our near-term directional bias. Caution is warranted ahead of the Bank of Canada interest rate decision on Wednesday with the event likely to fuel added volatility in CAD crosses. Follow the progress of trade setups like these and more throughout the trading week with DailyFX on Demand.

* It’s extremely important to give added consideration regarding the timing of intra-day scalps with the opening ranges on a session & hourly basis offering further clarity on intra-day biases.

Key Threshold Grid

*ORH: Opening Range High

*ORL: Opening Range Low

Other Setups in Play:

• EURJPY Key Outside Reversal Shifts Near-term Focus Higher

• NZDUSD Scalps Target Key Resistance at 0.8000

• EURAUD Scalps Target 1.46- Breakout Levels Well Defined

• GBPAUD Outside Reversal Favors Longs Scalps- 1.8440 Resistance

• Scalping the AUDUSD Opening Range- Longs Favored Above 8660

• EURUSD October Opening Range Setup- 1.27 Key Resistance

• EURCAD Shorts at Risk Ahead of ECB- Key Support 1.4053

---Written by Michael Boutros, Currency Strategist with DailyFX

For updates on this scalp and more setups follow him on Twitter @MBForex

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