The EUR/CAD pair has been grinding lower over the last several weeks, as you can see by the attached chart. I believe that the 1.45 level below should be rather supportive though, and then on top of that I believe that the potential uptrend line will probably come into play as well. This pair will tend to mimic the EUR/USD pair, although it does have the added incentive of oil market intervention. After all, the Canadian dollar is heavily influenced by the oil markets, and they are starting to breakout to the upside.
With that, it would not surprise me at all to see this market continue to grind lower over the course of June, although I would not expect massive moves. After all, June is when a lot of traders start thinking about taking vacation as opposed to trading, so it’s very possible that these less major pairs may become a little bit illiquid.
Overall uptrend, still see that as being the case.
We are most certainly and an overall uptrend, and I still see that as being the case. With that, I would fully anticipated to continue going higher, and the nice gentle slope that we have seen over the last years should be easily maintained. In fact, I believe that a lot of this pullback that we’ve seen is simply a return to normalcy, and in the near-term we should see an opportunity to continue what’s worked for so long.
Ultimately, I believe that the 1.55 level does in fact get broken to the upside, and that the trend continues the way it has. However, short-term volatility in the oil markets may make it a bit difficult over the next couple of weeks, but at the end of the day I believe that a lot of the volatility in this pair will be based upon the European Central bank, more than anything else. Obviously, oil markets have an effect, but longer-term the ECB tends to move the markets more, as the Canadians tend to produce a different type of crude than is being affected by the Crimean conflict.
