A sharp decline in EURCAD in mid-November ended a period of volatile but trendless trading around the 13 and 21 week moving averages. That fresh negative bias for the cross yielded more than 5 big figures to this year’s low.

But the EURCAD decline was not an aggressive one but the rally from last month’s bottom has been. Last week’s investor demand posted a 2nd up week in a row with prices rising to the most positive levels traded for 16 weeks.

More importantly EURCAD broke above the 21 week average and made a positive, ‘golden’, cross in our RSI indicator. These confirming signals indicate a change in signals for sentiment, although the path higher is likely to be as volatile as the move lower was.

We’d expect setbacks to be contained near 1.4156, last week’s low, although only a close below both the 21 week line and the RSI average would be assessed as bearish for EURCAD.

On the upside a move to the top of the weekly Keltner channel, currently 1.4455, is our first objective  with 1.4701 behind that.

About FX Renew

This blog post was published on www.fxrenew.com, a provider of Forex signals from ex-bank and hedge fund traders (get a free trial). If you like this post, subscribe to the blog for free or get free access to the acclaimed Advanced Forex Course for Smart Traders.