By: Dima Chernovolov
EUR/CAD recently broke the 4-hour Down Channel which was recently identified by Autochartist. Autochartist rates the quality of this Down Channel at the 8-bar level – which is the result of the sharp Initial Trend (9 bars), above-average Uniformity (6 bars) and strong Clarity (8 bars). EUR/CAD is expected to rise toward the forecast price 1.5280 – in line with the earlier breakout of the resistance area shown below.
As can be seen from the daily EUR/CAD chart below, the breakout of this Down Channel coincided with the breakout of the resistance area lying between the key the resistance level 1.5120 (which has been reversing the price from the start of October) and the 61.8% Fibonacci correction of the previous downward impulse from September. This price area is acting as strong support zone after it was broken. The proximity of this support area increases the probability EUR/CAD will continue rise toward the forecast price 1.5280.
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