Euro Cross Pick 07.06.10
The near-term rally in the EUR/CAD appears to be tapering off as the daily RSI falls back from a high of 67, and we may get a corrective retracement this week as price action struggles to hold above the 100-Day SMA at 1.3365. As a result, I will look to sell the euro-loonie at Friday’s low of 1.3210, and will look for a break below the 50-Day SMA at 1.2929, with the stop at 1.3274, the 5/25 low. At the same time, the European Central Bank is widely expected to hold the benchmark interest rate at 1.00% this week as the governments operating under the single-currency plan to tighten fiscal policy, and the Governing Council may hold a dovish outlook throughout the second-half of the year as the banking system remains fragile.
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