Data out of the Eurozone this week has so far have been net encouraging, even though the earlier release of German consumer confidence survey missed expectations. The German October Ifo business sentiment survey came in yesterday at 100.5, up from 109.5 in the previous month, tallying with strong PMI readings for Germany on Monday. French national business confidence numbers were weaker than hoped, but the readings at company level were better. This combined with USOil breaking the psychological USD 50.00 level, lead me to the EURCAD pair.
Yesterday’s breach and break of the 38.2 Fibonacci level, following rejection on Friday and Monday, suggested further strength into the 50.0 Fibonacci level and the 1.4600 level. Entry was today at 1.4550 with Target 1 1.4620 where the 20, 50 DMA are found. Target 2 is at the next psychological level and a little over the 14 DATR at 1.4700. The RSI remains over 50 and positive and also the Parabolic SAR reversed today too. However, the short term Stochastics are suggesting the current up move may be overbought.
The volatility in the sterling yesterday, closed my, against the trend LONG trade in GBPAUD for a net loss of 120 pips, the GBPCHF position remains open.
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About Janne Muta, HotForex’s Chief Market Analyst
Janne Muta is a seasoned industry professional with over 16 years experience in the global markets. Originally from Finland, Janne has worked for institutions in both Helsinki and London as an institutional fund manager, global market analyst and FX educator.
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