Hi Traders! Today I am sharing with you the EURCAD technical analysis and short term forecast post. The way I would like to analyze the chart for setups is based on multi-timeframe confirmations because in my POV if we get more evidences on different timeframes for the same direction then it makes the setup much more reliable. If you would like to learn more about the way we trade and the technical analysis we use then check out the Traders Academy Club Spoiler alert – free memberships are available! here). Now, let’s start our analysis from the highest timeframe which will be the daily chart here.
EURCAD D1(Daily) Chart Analysis – Psychological Level, Multiple False Breaks, Bullish Divergence, Parabolic Sar, ADX Indicator
On the daily chart, the price which was moving lower reached the psychological level 1.35 respected it and bounced higher from this zone. Also, we could see that the price which was moving lower has created multiple false breaks with bullish divergence between the first low that has formed at 1.36723 and the second low that has formed at 1.33876 based on the MACD indicator, we may consider these as evidences of bullish pressure. In addition to this, based on the Parabolic Sar we could see that the dots are below the price which we may consider as yet another evidence of bullish pressure. Also, the ADX indicator gave a bullish signal here at the cross of +DI (green line) versus -DI (red line) and the main signal line (silver line) reads value over 25, we may consider this as yet another evidence of bullish pressure. Also, currently there are no signs opposing this short term bullish view. We may now move down to lower timeframe and look for evidences supporting this short term bullish view.
EURCAD H4(4 Hours) Chart Analysis – Higher Highs, ADX Indicator, Two Strong Support Zones
Looking at the H4 chart, we could see that the price which is moving higher has created higher highs based on the MACD indicator, which is a sign of gaining momentum towards the bullish side. In addition to this, the ADX indicator gave a bullish signal here as well at the cross of +DI (green line) versus -DI (red line) and the main signal line (silver line) reads value over 25, we may consider this as yet another evidence of bullish pressure. Also, we had two strong resistance zones that has formed and the price which was moving higher has broken above these zones and is holding above them. After the breakout these strong resistance zones are acting as two strong support zones for us. Until both these strong support zones hold my short term view remains bullish here and I expect the price to move higher further.
Technical Analysis & Forecast Summary
EURCAD D1(Daily) Chart Analysis
- Psychological Level, Multiple False Breaks, Bullish Divergence, Parabolic Sar, ADX Indicator
EURCAD H4(4 Hours) Chart Analysis
- Higher Highs, ADX Indicator, Two Strong Support Zones
Trading Tips
It is always recommended to look for confirmations before you jump into any trade. If you are not sure about how to trade this short term buy setup then you can use any setup and strategy that you have in your arsenal to look for bullish moves and join this buy trade.
Also, don’t forget to protect your buy trade using a stop loss and make sure to set a target and keep a proper risk/reward ratio.
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Happy Trading!
Arvinth Akash
Traders Academy Club Team
