Euro Forecast: EUR/AUD, EUR/CAD, EUR/NZD Rates Outlook

EURO VERSUS COMMODITY CURRENCIES IS A MIXED PICTURE

The Euro has, generally speaking, experienced quieter trading conditions relative to some of its other major counterparts. Thanks to a retrenchment in both global bond yields and commodity prices, the Euro has been quietly racking up gains against the trio of commodity currencies. But amid the countertrend rallies, the fact of the matter is that not much progress has been made for any of EUR/AUD, EUR/CAD, and EUR/NZD rates.

Each of the pairs remain in the throes of the longer-term bearish technical considerations, and in light of the fact that June has been the best month of the year for the Australian, Canadian, and New Zealand Dollars in recent history, it is thus the case that traders should be hesitant about any near-term upside. Instead, gains among EUR/AUD, EUR/CAD, and EUR/NZD rates may prove to be selling opportunities before the next legs lower.

EUR/AUD RATE TECHNICAL ANALYSIS: DAILY CHART (JANUARY 2017 TO JUNE 2021) (CHART 1)

Euro Forecast: EUR/AUD, EUR/CAD, EUR/NZD Rates Outlook

The rally by EUR/AUD rates has slowed, although the rising parallel channel from the 2021 low remains in place, with the pair continuing its advance from support in the form of the ascending trendline from the August 2012 and April 2017 lows. But momentum has started to turn, suggesting a retest of the near-decade-long uptrend may soon result. EUR/AUD rates are intertwined among their daily EMA envelope, which is in neither bearish nor bullish sequential order. Daily MACD is trending lower while above its signal line, and daily Slow Stochastics have dropped below their median line; daily Slow Stochastics had previously held above the median line since the second week of May.

EUR/CAD RATE TECHNICAL ANALYSIS: WEEKLY CHART (OCTOBER 2008 TO JUNE 2021) (CHART 2)

Euro Forecast: EUR/AUD, EUR/CAD, EUR/NZD Rates Outlook

Taking a step back to the weekly timeframe for EUR/CAD rates, it’s evident that bearish momentum remains firmly in place. The pair remains below its weekly 4-, 8-, 13-, and 26-EMA envelope, which is in bearish sequential order. Weekly MACD is moving sideways in bearish territory, and weekly Slow Stochastics are holding in oversold territory. It’s noteworthy that both momentum indicators have started to relieve their oversold readings yet there hasn’t been a subsequent recovery in EUR/CAD rates (typically a longer-term bearish development).

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