The euro has been on a tear in the past trading sessions, but can it hold up against the Loonie with risk appetite kicking in?
A couple of low-tier reports are due from the euro zone over the next few hours while the Canadian dollar has the jobs report to look forward to.
So will it be a bounce or break for EUR/CAD at its range resistance?
Before we check out the chart, read the major headlines that influenced price action during the Asian session!
Fresh Market Headlines & Economic Data:
- OPEC+ moved its meeting from June 9 to June 6
- Oil climbs as traders stay hopeful about more output cuts
- Novavax wins U.S. contract to develop COVID-19 vaccine
- U.K. GfK consumer confidence index down from -34 to -36
- Japanese household spending down 11.1% y/y vs. projected 12.8% slump
- Japanese leading indicators down from 84.7% to 76.2% vs. 76.3% forecast
Upcoming Potential Catalysts on the Economic Calendar:
- German factory orders at 7:00 am GMT
- SNB foreign currency reserves at 8:00 am GMT
- U.K. Halifax HPI at 8:30 am GMT
- Italian retail sales at 9:00 am GMT
What to Watch: EUR/CAD
EUR/CAD is sitting right at the top of its range on the 1-hour time frame, probably deciding whether to make a break for it or head back to support.Note that the euro has bullish momentum on its side as the ECB stimulus announcement sent the shared currency skyrocketing lately.
However, the Loonie is putting up a pretty strong fight as crude oil prices have drawn support from speculations that the OPEC is mulling more production cuts. Even better, many are hopeful that it could get Russia on board with an output deal.
This has been enough to keep risk-taking in play for the past few hours and might be able to drag EUR/CAD back to the bottom of its range at 1.5065. Stochastic is indicating overbought conditions after all, so sellers could be ready to regain control.
Just be careful if you’re shorting this pair since Canada has its jobs report coming up much later on. A disappointing read could spur an upside breakout for this pair instead, resulting in a rally that’s around the same height as the range.
Either way, don’t forget to check out the average EUR/CAD volatility when setting stops and targets!