Forex Market: EUR/CAD daily trading forecast

Yesterday’s trade saw EUR/CAD within the range of 1.3484-1.3603. The daily high has also been the highest level since March 10th, when a high of 1.3692 was recorded. The pair closed at 1.3554, up 0.41% on a daily basis and extending gains from Monday.

At 8:57 GMT today EUR/CAD was up 0.22% for the day to trade at 1.3579. The pair touched a daily high at 1.3593 at 7:55 GMT.

Fundamentals

Euro area

Balance of Trade

The surplus on Euro areas seasonally adjusted trade balance probably narrowed to EUR 21.1 billion in January, according to the median forecast by experts, from a surplus figure of EUR 23.3 billion in December.

The regions trade surplus, without a seasonal adjustment, was reported to have reached EUR 24.3 billion in December, or the highest figure on record, following a surplus of EUR 21.2 billion in November. Total exports rose at an annualized rate of 8% to reach EUR 161.5 billion in December, while imports went up 2% to EUR 137.2 billion.

The surplus on regions extra-EU28 trade balance amounted to EUR 12.4 billion in December 2014 compared to a surplus of EUR 8.1 billion in December 2013. The highest increases in EU28 exports were registered with China (+11% during the first 11 months in 2014 compared to the same period a year ago), South Korea (+8%) and the United States (+6%). As for EU28 imports, the highest increases were observed with South Korea and China (both +8%) and Turkey (+7%).

Euro zones balance of trade produces regular surpluses mainly due to the high export of manufactured goods, such as machinery and vehicles. At the same time, the region is a net importer of energy and raw materials. Member states such as Germany, Italy, France and Netherlands play a key role in total trade.

The trade balance, as an indicator, measures the difference in value between the region’s exported and imported goods and services during the reported period. It reflects the net export of goods and services, or one of the components to form the Gross Domestic Product. Generally, exports reflect economic growth, while imports indicate domestic demand. In case the trade balance surplus narrowed more than anticipated in January, this would certainly have a bearish impact on the euro. Eurostat is to publish the official trade data at 10:00 GMT.

Pivot Points

According to Binary Tribune’s daily analysis, the central pivot point for the pair is at 1.3547. In case EUR/CAD manages to breach the first resistance level at 1.3610, it will probably continue up to test 1.3666. In case the second key resistance is broken, the pair will probably attempt to advance to 1.3729.

If EUR/CAD manages to breach the first key support at 1.3491, it will probably continue to slide and test 1.3428. With this second key support broken, the movement to the downside will probably continue to 1.3372.

The mid-Pivot levels for today are as follows: M1 – 1.3400, M2 – 1.3460, M3 – 1.3519, M4 – 1.3579, M5 – 1.3638, M6 – 1.3698.

In weekly terms, the central pivot point is at 1.3513. The three key resistance levels are as follows: R1 – 1.3643, R2 – 1.3871, R3 – 1.4001. The three key support levels are: S1 – 1.3285, S2 – 1.3155, S3 – 1.2927.