Looking at the EURCAD’s daily chart, it appears that the pair is on a steady downtrend since December 2009. Traders always say that a “trend is your friend.” Given the pair’s present trend and the euro’s weakness, it is, therefore, wiser to just ride the current down-wave. Now, the pair could range for awhile somewhere between last week’s low of 1.3131 and 1.2900 since the stochastics are already at oversold territory. If, however, the pair busts below yesterday’s low of 1.28721, it could head straight for the 1.2700 handle.
The 0.2% upsides in Germany’s and the euro zone’s GDP during the first quarter of this year were not enough to life the euro against the Loonie. Instead, the EURCAD just traded flat right after the positive GDP results came out. In my opinion, as long as there are uncertainties surrounding the euro zone regarding the debt crisis that it is experiencing, no single positive economic data, not even a strong GDP figure, as we just recently saw, could lift the euro.
The Loonie, on the other hand, could strengthen further since its latest trade balance figure is expected to have expanded to C$1.6 billion from C$1.4billion. Canada’s trade balance result will be released today at 12:30 pm GMT.