FxWirePro: EUR/CAD recovery capped below 5-DMA, on track to test 78.6% Fib, stay short

EUR/CAD chart on Trading View used for analysis

• EUR/CAD recovery capped below 5-DMA, the pair trades 0.04% lower on the day at 1.4987 at 0550 GMT.
   
• The pair is extending weakness below daily cloud, bias lower, momentum with the bears.
   
• Price action has broken major trendline support and is on track to test 78.6% Fib at 1.4944.
   
• Stochs and RSI are biased lower and MACD supports weakness. Break below 78.6% Fib to see further downside.
   
• On the upside, 5-DMA is immediate resistance at 1.5019. Bearish invalidation only above 200-DMA.
   
• Focus on Markit's Services PMI reports for the euro area and Germany later in the day for further impetus. 
   
• If the PMI data from the eurozone disappoint, we could see the shared currency come under a renewed pressure.

Support levels - 1.4944 (78.6% Fib), 1.4914 (Dec 3rd low), 1.4855 (88.6% Fib)

Resistance levels - 1.5019 (5-DMA), 1.5119 (21-EMA), 1.5163 (200-DMA)

Recommendation: Good to go short on upticks, SL: 1.5120, TP: 1.4945/ 1.4920/ 1.4855

For details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex.