The EUR/CAD currency pair is on the rise, bouncing back from a three-week low near 1.6170-1.6175 and moving past 1.6300. It peaked during the Asian session on Wednesday. The technical outlook looks positive, as the pair has crossed above the 50% Fibonacci retracement level related to a recent drop from 1.6400, a level last reached in April 2009.

Upward Trend and Support Levels

Daily chart indicators show the EUR/CAD is trending upwards, which supports further gains. If buying continues past the 61.8% Fibonacci retracement level around 1.6315, the forecast remains bright, potentially driving the pair toward the mid-1.6300s. If the momentum stays strong, we may see attempts to break the 1.6400 barrier again. However, if EUR/CAD falls below the 50% Fibonacci retracement level, expect support around 1.6270. More solid support lies between 1.6250 and 1.6245. If the pair drops below these levels, especially breaking below 1.6200, the trend could shift in favor of sellers. The heat map shows how the Euro is performing against other currencies. Currently, there is a clear bullish trend for the EUR/CAD. Traders should prepare for continued upward movement in the coming weeks. The technical signals suggest a test of the multi-year peak around 1.6400. Strategies like buying call options or long futures contracts are favorable now.

Euro Momentum and Canadian Dollar Weakness

The Euro’s upward momentum is supported by strong fundamental factors. The European Central Bank is maintaining a firm policy stance, with Eurozone inflation for September 2025 reported at 2.7%. The ECB has indicated its key interest rate will stay at 4.0% until the end of the year, a stark contrast to earlier expectations of rate cuts. Meanwhile, the Canadian dollar is weakening due to falling energy prices, which are vital for the Canadian economy. WTI crude oil prices have dropped nearly 12% in the last two months and are currently just above $71 per barrel, as global demand forecasts have changed. This ongoing pressure on oil limits the strength of the Canadian dollar. The differences in policy and commodity performance remind us of market conditions from more than a decade ago. We are nearing exchange rates for this pair that haven’t been seen since April 2009. Historical trends indicate that the pair can move significantly when these economic factors align. Traders might consider any temporary drops toward the 1.6270 level as a buying opportunity. A good risk management strategy would be to reassess the bullish outlook if the pair decisively breaks below the 1.6200 support zone. This scenario would invalidate the current positive trend. Create your live VT Markets account and start trading now.

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