Source: ForexYard
One of the less-frequently analyzed pairs is providing us with signs of an impending bearish run.
The EUR/CAD appears to be forming what looks like a head-and-shoulders pattern on the daily chart, suggesting we could see long-term bearishness as we head into 2011.
The pair’s steep decline over the first half of 2010 led to a record low of 1.2466 in early June, but it looks to have been recovering since.
What we see now, however, looks to be signaling that the down-trend was not actually over, but stalling within a larger cycle.
If what is shown on the chart below turns out to be a head-and-shoulders formation, then traders should look to see the pair finding support at the 23.6% Fibonacci line and moving up towards the 1.36-37 range before entering another steep decline with targets near the record low of 1.2466.
EUR/CAD – Daily Chart
Forex Market Analysis provided by ForexYard.
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