EURCAD recovered slightly to the upside after it reached a fresh 22-month low around the 1.4600 psychological mark last week. However, the pair dived aggressively from the 1.4880 – 1.5210 trading range, extending bearish actions below the short-term moving averages in the daily timeframe. The RSI and the MACD are lacking direction as both are moving in negative area with weaker momentum than before, suggesting overstretched market.
If the pair drops beneath the multi-month trough could move towards the strong support zone of 1.4440 – 1.4490, taken from the lows on September 2017.
Should an upside reversal take form, immediate resistance would likely come from the 20-SMA, which overlaps with the 1.4750 barrier. A break above this line, the pair could send the pair towards the 1.4880 obstacle and the 40-SMA.
Overall, both the short- and medium-term outlooks are currently looking bearish, though caution is warranted in the near-term as there are signs of an oversold market.
