FxWirePro: EUR/CAD minor trend in sloping channel, major trend in rising channel – Bid touch puts and short hedge

EURCAD bearish candles with big real bodies are signifying the weakness of this pair in the major trend and the minor trend slides through sloping channel, these bearish patterns nudge prices below DMAs, while the bulls bounce back with engulfing pattern.

While the momentum oscillators indicate bearish pressures, more slumps possible on intensified bearish momentum. 

On a broader perspective, the major trend spikes through rising channel, shooting star pops-up exactly at channel resistance followed by dips, and hammers at channel support in the past (refer monthly plotting), but the major trend through rising channel are not backed by momentum confirmation (refer monthly chart). 

Both RSI and stochastic curves are showing the downward convergence to the price slumps (monthly). This indicates the lingering bearish sentiments. The lagging indicators have been indecisive but slightly bearish bias.

Hence, for today, contemplating above technical rationale, at spot reference: 1.4871 levels, bid one touch put options (strikes at 1.4778 levels), the strategy would likely fetch us handsome yields with magnified effects as the underlying spot FX keeps dipping on expiration.

Alternatively, shorting futures contracts with mid-month tenors is advocated on hedging grounds.

Currency Strength Index: FxWirePro's hourly EUR spot index is flashing at -75 (which is bearish), while hourly CAD spot index was at 31 (mildly bullish) at 06:18 GMT. 

For more details on the index, please refer below weblink:

http://www.fxwirepro.com/currencyindex