EURCAD is trending higher on its short-term chart, forming higher lows connected by a rising trend line that’s been holding since last week. Price looks due for another test of support soon.

The Fibonacci retracement tool shows where more buyers might be looking to hop in. The 50% level lines up with the 1.3750 minor psychological mark while the 61.% level is closer to the trend line and 1.3650 minor psychological support. A shallow pullback could already find buyers at the 38.2% Fib near 1.3700.

The 100 SMA is above the 200 SMA to confirm that the path of least resistance is to the upside or that support is more likely to hold than to break. The gap between the indicators is widening to reflect strengthening bullish momentum, and the 100 SMA is just below the trend line to add to its strength as a floor.

Stochastic is still on the move down to suggest that bearish pressure is in play, but the oscillator is also dipping into the oversold region to reflect exhaustion. Turning higher would show that buyers are back in the game and could take EURCAD back up to the swing high at 1.3800 or higher.

RSI has more room to head south, so price could follow suit while bearish momentum is present. This suggests that the correction could keep going until oversold conditions are met.

EURCAD could take cues from the release of Canada’s retail sales report, which is slated to show stronger consumer spending data for April. Headline retail sales likely advanced from 0.1% to 1.5% while the core version of the report probably ticked 2.2% higher.

Stronger than expected results could mean more upside for the Loonie, as this might put the BOC closer to another interest rate hike. Weak data, on the other hand, could lead to declines for the Canadian currency.