EUR/CAD Trading Near Important Resistance Level despite Slowdown in German Economy

Eurozone – German ZEW Economic Sentiment

Tomorrow, at GMT 9:00 a.m., the Zentrum fur Europaische Wirtschaftsforschung (ZEW) will release its German economic sentiment index, which measures the level of a diffusion index based on surveying 275 German institutional investors and market analysts.

Since the professional investment community, investors and analysts have the latest data; their reflection about the economy tends to be the most accurate. Therefore, binary options traders consider the ZEW’s German economic sentiment index to be a leading indicator of the entire Eurozone economy. This is because the German economy is one the most important driving forces behind the Euro currency.

Last month, the ZEW German economic sentiment came out at 12.1, and this month the forecast is set at a very pessimistic level, at 6.8.

Canada – Manufacturing Sales

Later on Friday, at GMT 12:30 p.m., the Statistics Canada will release the month-over-month manufacturing sales data, which measures the changes in the total value of sales made by Canadian manufacturers over the past month.

Since changes in manufacturing sales affect the manufacturers’ future decisions regarding hiring, corporate spending, and overall investment climate in the country, binary options investors consider the manufacturing sales data to be a leading indicator of the Canadian economy.

In September, the Canadian manufacturing sales figure increased by 1.7% and the forecast for October is currently set at a decrease of 0.6%.

Trade Recommendation for the EUR/CAD

EURCADDaily

After breaking below the uptrend line, the EUR/CAD mostly remained range bound for the last two weeks. However, on October 5, the EUR/CAD price finally closed below the important psychological support level around 1.4750.

However, a day later it formed a bullish pin bar, which pushed the price once again towards the 1.4750 level. So far, the EUR/CAD tested this resistance level several times, but failed to close above it.

As the German ZEW economic sentiment is expected to decline over the last month, the fundamental outlook for the EUR/CAD would remain bearish this week. But, if the figure comes higher than what the market is expecting and the EUR/CAD price closes above the important 1.4750 level, it may attract additional bullish momentum in the market.

Under the circumstances, it is recommended that traders consider placing a CALL order for the EUR/CAD with their binary options trading brokers once it closes above the 1.4750 level.

Recommended Broker: GOptions

Asif Imtiaz

Asif worked as a prop trader for almost a decade, and later he managed trading operations for one of the largest foreign exchange strategy developers in Europe. Currently, he works as a trading consultant to several brokers and write on various tech and financial topics. You can reach him at contact@asifimtiaz.com

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