Forex Market: EUR/CAD daily trading forecast

Yesterday’s trade saw EUR/CAD within the range of 1.4071-1.4213. The daily low has also been the lowest level since January 28th, when a low of 1.4062 was recorded. The pair closed at 1.4118, losing 0.32% on a daily basis and extending losses from last Friday.

At 8:22 GMT today EUR/CAD was up 0.04% for the day to trade at 1.4124. The pair touched a daily high at 1.4148 during early Asian trade.

Fundamentals

Euro area

Italian industrial production

Annualized industrial production in Italy probably contracted for a sixth consecutive month in December, at a pace of 1.3%, according to the median forecast by experts, following another 1.8% drop in November. If so, this would be the least annual decline since August 2014, when output shrank 0.7%. Italian seasonally adjusted index of industrial production probably remained flat in December compared to a month ago, following a 0.3% increase in November compared to October. The index reflects the change in overall inflation-adjusted value of output in sectors such as manufacturing, mining and utilities. In case output shrank more than anticipated, this would have a limited bearish effect on the common currency. The National Institute of Statistics (Istat) is to release the official industrial numbers at 9:00 GMT.

Greek bailout worries

On Sunday Greeces Prime Minister Alexis Tsipras ruled out extending the nations bailout deal and said that some of the reforms imposed by lenders would be reversed, Reuters reported. The European Commission President Jean-Claude Juncker said yesterday that Greece should not expect the Euro region to accept their latest terms. “While we are not explicitly forecasting Greeces departure from the euro zone, the initial fall-out in the financial markets could be substantial if it happened and were disorderly,” economists at Capital Economics wrote in a note to clients, cited by the same media. “Admittedly, the authorities in the euro zone have put lots of backstops in place to head off any contagion at the pass. But given the rising popularity of anti-austerity parties elsewhere in the region, we doubt investors would be completely convinced that Greeces departure was a one-off”, according to the note.

Pivot Points

According to Binary Tribune’s daily analysis, the central pivot point for the pair is at 1.4134. In case EUR/CAD manages to breach the first resistance level at 1.4197, it will probably continue up to test 1.4276. In case the second key resistance is broken, the pair will probably attempt to advance to 1.4339.

If EUR/CAD manages to breach the first key support at 1.4055, it will probably continue to slide and test 1.3992. With this second key support broken, the movement to the downside will probably continue to 1.3913.

The mid-Pivot levels for Monday are as follows: M1 – 1.3953, M2 – 1.4024, M3 – 1.4095, M4 – 1.4166, M5 – 1.4237, M6 – 1.4308.

In weekly terms, the central pivot point is at 1.4254. The three key resistance levels are as follows: R1 – 1.4399, R2 – 1.4626, R3 – 1.4771. The three key support levels are: S1 – 1.4027, S2 – 1.3882, S3 – 1.3655.