By Yan Peters – Looking at the EUR/CAD 4-hour chart, it appears that the uptrend may have reached its peak at the 1.6000 level. The chart provides several signals for a trend reversal, and an opportunity to open a short position might be getting closer.
• The chart below is the EUR/CAD 4-hour chart by ForexYard.
• The technical indicators used are the Bollinger Bands, the Slow Stochastic, the MACD/OsMA and the Relative Strength Index (RSI).
• It can be noted that the pair had several failed attempts to test the 1.6000 level in the past month.
• A sequence of bearish crosses can also be observed in the Slow Stochastic, indicating that the bullish momentum might have reached its end.
• The MACD is also providing a bearish cross at the moment. If a sharp drop will be followed, the pair is likely to go in the same direction.
• The RSI has recently reached above the 70 line, in what is known as the Over-Bought zone. The RSI then dropped back down, signaling a trend reversal.
• There appears to be two significant support levels on the chart. The nearest one is located at the 1.5765 level. If the pair will breach through this level, it is likely to reach the next one which is located at the 1.5650 level.
Forex Market Analysis provided by Forex Yard.
© 2006 by FxYard Ltd
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