EURCAD breaks back below 20-day moving average
Euro/Canadian Dollar (EURCAD) Technical Analysis Report for Oct 11, 2019 | by Techniquant Editorial Team
Moving lower for the 2nd day in a row, EURCAD finished the week -0.28% lower at 1.4572 after losing 55 pips (-0.38%) today on high volume. Trading 56 pips higher after the open, the currency was unable to hold its gains as the bears took control ending the day below its opening price. Closing below Thursday's low at 1.4615, the FX pair confirmed its breakout through the previous session low after trading up to 67 pips below it intraday.
Daily Candlestick Chart (EURCAD as at Oct 11, 2019):
Friday's trading range has been 137 pips (0.94%), that's far above the last trading month's daily average range of 85 pips. Things look different on the weekly timeframe, where the market's trading range of the last week has been below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for EURCAD.
Regardless of a strong opening the pair closed below the prior day's open and close, forming a bearish Engulfing Candle.
EUR/CAD closed back below the 20-day moving average at 1.4579 for the first time since October 1st. When this moving average was crossed below the last time on September 20th, EURCAD lost -0.24% on the following trading day. After having been unable to move above 1.4690 in the previous session, the forex pair ran into sellers again around the same price level today, missing to move higher than 1.4685.
Though the market is experiencing a short-term uptrend, this could just be a correction, as both the medium and long-term trends are still bearish.
With prices trading close to this year's low at 1.4416, downside momentum might speed up should EURCAD break out to new lows for the year.
Among the 10 market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Bearish Engulfing Candle" stand out. Its common bearish interpretation has been confirmed for EUR/CAD. Out of 125 times, EURCAD closed lower 50.40% of the time on the next trading day after the market condition occurred. The optimal exit for swing trading this condition on the short side has been after 10 trading days, showing a win rate of 56.80% with an average market move of -0.23%.
With six out of the seven Major FX Pairs closing higher today, the ones that stand out on the positive side are GBPUSD gaining 1.67% and AUDUSD closing 0.47% higher. On the flipside the worst performer has been USDCAD closing -0.67% lower. Looking at the other Minor FX Pairs and Crosses, the winners of the day have been ZARJPY surging 2.23% and GBPJPY closing 2.1% higher. The worst performers of the day have been CHFZAR tanking -1.88% and USDZAR closing -1.87% lower. Read more