By: Mike Kulej
The Euro has been one of the best performing currencies recently. While the EUR-USD pair gets most attention, the common currency has appreciated substantially on broad bases. It had a very strong rally against, amongst others, the Canadian Dollar. In early June, this pair almost matched the all time low, when it fell to 1.2448.
Since then, however, it has been almost straight up, a trend, which accelerated dramatically in September, when the EUR-CAD gained about 1200 in matter of weeks. This moved during last few days, but the uptrend is still intact.
The price is comfortably above the main trendline, which, in turn almost matches the 100 SMA as a support. That is a positive sign for the EUR-CAD, and so is the ADX indicator. It has a very high reading, even though it pulled back a little recently.
The RSI is just under the overbought reading of 70 and could be warning about a possible correction. A pull back after such a strong uptrend is not unusual and rather normal. Should this happen, the EUR-CAD has a support at 1.3700, a level of past resistance. Until that level and/or the trendline are broken, the uptrend is valid.