Insights 
VT 
The EUR/CAD currency pair has been experiencing a positive momentum, rebounding from its three-week low around the 1.6170-1.6175 level and climbing past the 1.6300 mark, reaching a peak for the week during the Asian session on Wednesday. The technical perspective suggests a bullish outlook, driven by the surpassing of the 50% Fibonacci retracement level linked to the recent pullback from the 1.6400 mark, a height not reached since April 2009.
Upward Trend and Support Levels
Additionally, daily chart oscillators are showing an upward trend, supporting further growth in the EUR/CAD valuation. A continued buying behaviour beyond the 61.8% Fibonacci retracement level near 1.6315 is likely to reinforce this optimistic forecast, potentially pushing towards mid-1.6300s. If momentum sustains, there could be attempts to breach the 1.6400 threshold once more.
Despite this, if the EUR/CAD slips below the 50% Fibonacci retracement, support is expected around the 1.6270 area, with more substantial backing between 1.6250-1.6245. Any downward movement below these points, such as breaking the 1.6200 mark decisively, may shift the trend to favour the bears. The heat map further provides insights into percentage changes of the Euro against other currencies.
We see a clear bullish setup for the EUR/CAD, suggesting traders should position for a continued move higher in the coming weeks. The technical picture points toward a retest of the multi-year peak near 1.6400. Bullish strategies, such as buying call options or long futures contracts, appear favorable at this time.
Euro Momentum and Canadian Dollar Weakness
This upward momentum in the Euro is underpinned by fundamental factors, as the European Central Bank continues to hold a firm policy stance. Eurozone inflation for September 2025 was just reported at a stubborn 2.7%, prompting the ECB to signal its key interest rate will remain at 4.0% through the end of the year. This contrasts sharply with market expectations from earlier in the year which had priced in cuts.
Meanwhile, the Canadian dollar is weakening due to a slump in energy prices, a critical component of the Canadian economy. We have seen WTI crude oil prices fall nearly 12% in the last two months, now trading just above $71 per barrel on updated global demand forecasts. This sustained pressure on oil directly limits the Canadian dollar’s strength.
This divergence in policy and commodity performance brings back memories of market conditions from over a decade ago. We are now approaching exchange rates for this pair that have not been seen since April 2009. That historical precedent shows how far the pair can run when these specific economic drivers are in place.
Therefore, traders could use any temporary pullbacks toward the 1.6270 level as a potential buying opportunity. A good risk management strategy would be to reconsider the bullish outlook if the pair breaks decisively below the 1.6200 support zone. This level would invalidate the current positive structure and shift the bias.
