EURCAD Projection 1.4725
EURCAD spent most of last week in retracement, following a failed breakout attempt on
Friday 2nd August. A clue to this was in the Volume.
At the first day of August a bullish pin bar formed on higher Volume off the 20D MAV.
The Volume to breakout on the next day was lower, and yet the spread 4x's larger. This means there would not be a sustained push by the Buyers, and quickly the move fizzles out, as the Sellers take control.
These false breakouts act as Bull Traps, and invariably see price reenter the consolidation.
As such looking for a price move back towards the 200MAV at 1.4725. This would be at the limit of the weekly ATR (which has been 250 pips in the last 2 weeks).
If we consider an Intermarket Analysis, Crude Oil seems to be in an uptick and likely to go higher next week. Given that this commodity is a close proxy for the Loonie, lends an argument to a fall in EURCAD.
Friday 2nd August. A clue to this was in the Volume.
At the first day of August a bullish pin bar formed on higher Volume off the 20D MAV.
The Volume to breakout on the next day was lower, and yet the spread 4x's larger. This means there would not be a sustained push by the Buyers, and quickly the move fizzles out, as the Sellers take control.
These false breakouts act as Bull Traps, and invariably see price reenter the consolidation.
As such looking for a price move back towards the 200MAV at 1.4725. This would be at the limit of the weekly ATR (which has been 250 pips in the last 2 weeks).
If we consider an Intermarket Analysis, Crude Oil seems to be in an uptick and likely to go higher next week. Given that this commodity is a close proxy for the Loonie, lends an argument to a fall in EURCAD.
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