Forex Market: EUR/CAD daily forecast

During yesterday’s trading session EUR/CAD traded within the range of 1.4570-1.4644 and closed at 1.4590, losing 0.1% on a daily basis.

At 6:45 GMT today EUR/CAD was gaining 0.02% for the day to trade at 1.4588. The pair touched a daily high at 1.4593 at 3:45 GMT.

Fundamental view

Euro zone

The annualized final consumer price index in the Euro zone, evaluated in accordance with Eurostat’s harmonized methodology, probably remained unchanged at 0.4% in July, matching the preliminary estimate reported on July 31st, that was the weakest since October 2009. In June the annualized final HICP stood at 0.5%, as reported on July 17th. The index shows the change in price levels of a basket of goods and services from consumer’s perspective and also reflects purchasing trends. The HICP is used to evaluate and compare inflation rates between Member States, according to Art . 121 of the Amsterdam’s Agreement and directives by the European Central Bank (ECB), in order to achieve price stability and the implementation of monetary policy. In case the HICP increased more than anticipated, thus, approaching the 2% inflation objective set by the ECB, this would support demand for the euro, because of the greater possibility of an interest rate hike. Eurostat is scheduled to release the official data at 9:00 GMT.

In addition, Euro zone’s preliminary annualized Gross Domestic Product probably expanded 0.7% during the second quarter of 2014, compared to a year ago. The quarterly GDP in the region probably inched up 0.1% in Q2, after a 0.2% increase in the first quarter of 2014. In case region’s economy expands more than expected, the single currency would receive support. Eurostat is to publish the official report at 9:00 GMT.

Canada

Selling prices of new homes in Canada probably inched up 0.2% in June compared to a month ago, when prices increased 0.1%. The New Housing Price Index is a key indicator, reflecting the health of nation’s housing market. In case prices surged more than anticipated, this would have a bullish effect on the loonie.

Statistics Canada will release the official data at 12:30 GMT.

Technical view

According to Binary Tribune’s daily analysis, the central pivot point for the pair is at 1.4601. In case EUR/CAD manages to breach the first resistance level at 1.4633, it will probably continue up to test 1.4675. In case the second key resistance is broken, the pair will probably attempt to advance to 1.4707.

If EUR/CAD manages to breach the first key support at 1.4559, it will probably continue to slide and test 1.4527. With this second key support broken, the movement to the downside will probably continue to 1.4485.

In weekly terms, the central pivot point is at 1.4670. The three key resistance levels are as follows: R1 – 1.4780, R2 – 1.4843, R3 – 1.4953. The three key support levels are: S1 – 1.4607, S2 – 1.4497, S3 – 1.4434.