Euro Begins to Trend Higher Against Australian and Canadian Dollars
- Now it is looking muscular against two other strong currencies, the Australian and Canadian Dollars, and that strength could well persist.
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Despite the continuing uncertainty about Brexit, the Euro is one of the strongest currencies around right now, and has advanced recently against two more buoyant currencies: the Canadian Dollar and the Australian Dollar.
Momentum is important in the markets and in recent days the Euro has reached its highest levels since January 2015 against the US Dollar and the Swiss Franc, since February 2016 against the Japanese Yen and since November 2016 against the British Pound.
However, those advances are now looking tired. IG Client Sentiment data suggest that the EUR/USD and EUR/GBP price trends may soon reverse lower and are showing a bearish contrarian trading bias for EUR/JPY and EUR/CHF.
Now, though, the Euro is looking firm too against both the Canadian and Australian Dollars. Against the former it has been climbing since mid-July and is now approaching the psychologically-important 1.50 level.
Chart: EUR/CAD Daily Timeframe (2017 to Date)
Against the Australian Dollar too, the 1.50 level is now within reach.
Chart: EUR/AUD Daily Timeframe (2017 to Date)
This suggests that if you believe the Euro is still attractive, it might be better to buy it against the Canadian Dollar or the Australian Dollar than against the other majors.
--- Written by Martin Essex, Analyst and Editor
To contact Martin, email him at firstname.lastname@example.org
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If you’re interested in tomorrow’s Bank of England decision and how it could affect the British Pound you can listen in to my webinar at 1045 GMT here
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