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Euro Technical Analysis: EUR/GBP, EUR/CAD, EUR/AUD

Euro Price Chart, EUR/GBP, EUR/CAD, EUR/AUD – TALKING POINTS

  • EUR/GBP is at a critical turning point as it tests multi-month resistance-turned-support
  • EUR/CAD has risen over five percent since late February – but will it continue to climb?
  • Euro outlook vs the Australian Dollar bullish as EUR/AUD trades above 11-year highs

EUR/GBP FORECAST

EUR/GBP has risen over 4.30 percent and has punctured formidable congestive-range-turned-resistance between 0.8597 and 0.8642. If the pair bounces back from this level with follow-through, it could mark the beginning of a bullish streak for EUR/GBP after it traded sideways with a tilt to the downside for several months.

EUR/GBP – Daily Chart

Chart showing EUR/GBP

EUR/GBP chart created using TradingView

EUR/CAD OUTLOOK

After suffering its longest losing streak on record with 12 consecutive days of losses, EUR/CAD has made a spectacular rebound and has risen over 5.40 percent after bottoming out at 1.4282. The pair may seek to challenge 12-month resistance between 1.5183 and 1.5223. Clearing that would open the door to testing 1.5397.

EUR/CAD – Daily Chart

Chart showing EUR/CAD

EUR/CAD chart created using TradingView

However, if EUR/CAD price action becomes more timid as it approaches the ceiling, a short-term bearish correction may ensue. A period of congestion may subsequently follow as a reflection of traders’ uncertainty about the pair’s upside potential. To get more updates on critical turning points for EUR/CAD, be sure to follow me on Twitter @ZabelinDimitri.

EUR/AUD PRICE CHART

Looking at a monthly chart shows EUR/AUD has been climbing on a three-year uptrend and is currently trading at 11-year highs. However, the intersection between it and resistance at 1.7636 will test the strength of the slope of appreciation as the pair enters a compression zone that may catalyze a bullish or bearish spike. The fundamental circumstances from the perspective of central bank policy is more supportive of the former.

EUR/AUD – Monthly Chart

Chart showing EUR/AUD

EUR/AUD chart created using TradingView

WHY HAS EURO BEEN RISING VS BRITISH POUND, CANADIAN DOLLAR, AUSTRALIAN DOLLAR?

Relative to the BOE, BOC and RBA, the ECB has comparatively less room for meaningful, downward interest rates adjustments. The gap between the yield on the Euro, GBP, CAD and AUD mean there is greater scope for a downward adjustment in the latter group than the former currency. In other words: there is more room for AUD, GBP and CAD to fall against the Euro than the other way around.

EURO TRADING RESOURCES

— Written by Dimitri Zabelin, Jr Currency Analyst for DailyFX.com

To contact Dimitri, use the comments section below or @ZabelinDimitrion Twitter