Forex Market: EUR/CAD daily forecast

During yesterday’s trading session EUR/CAD traded within the range of 1.4508-1.4562 and closed at 1.4550.

At 6:40 GMT today EUR/CAD was losing 0.15% for the day to trade at 1.4532. The pair touched a daily low at 1.4526 at 5:55 GMT.

Fundamental view

Euro zone

Euro zones non-seasonally adjusted current account may have narrowed to 16.2 billion EUR in May, from 18.7 billion EUR in the previous month.

At the same time, the surplus on Euro zone’s seasonally adjusted current account probably widened to 24.3 billion EUR in May, according to the median estimate of experts. In April the surplus figure was 21.5 billion EUR. The official data is to be released at 8:00 GMT.

The seasonally-adjusted current account is considered a more reliable indicator as it is not affected by short-term fluctuations (trend, economic fluctuations, seasonal fluctuations, calendar effects, residual or irregular fluctuations).

The European Central Bank will release an official report at 8:00 GMT. In case the seasonally-adjusted current account widened more than expected, this would provide a boost to the euro.

Canada

The Consumer Price Index (CPI) in Canada probably jumped 2.4% in June, compared to the same period a year ago, according to the median analysts’ estimate. In May, consumer prices rose 2.3%, the most since February 2012.

At the same time, the core CPI probably advanced by 1.7% in the previous month from a year ago, after a 1.7% gain in May, according to the median forecast by experts.

The Core Consumer Price Index differs from the basic CPI measure as it doesn’t take into account the indirect taxes and eight most volatile components identified by the Bank of Canada- fruit, fruit and nuts; mortgage costs, natural gas and other fuels, oils and other lubricants, public transport, tobacco products and supplies. This is the percentage change compared to the same month a year earlier.

Statistics Canada will publish its monthly report at 12:30 GMT today. Higher-than-expected readings will certainly heighten the loonie’s appeal.

Technical view

According to Binary Tribune’s daily analysis, in case EUR/CAD manages to breach the first resistance level at 1.4573, it will probably continue up to test 1.4594. In case the second key resistance is broken, the pair will probably attempt to advance to 1.4626.

If EUR/CAD manages to breach the first key support at 1.4518, it will probably continue to slide and test 1.4486. With this second key support broken, the movement to the downside will probably continue to 1.4464.