EURCAD might be in for a reversal from its uptrend, as the pair failed in its last two attempts to break past the 1.4800 handle. Price is now down to the neckline at 1.4650, and a break lower could confirm the downtrend.

The chart pattern spans around 150 pips in height, so the resulting breakdown could be followed by a drop of the same size.

The 100 SMA crossed below the 200 SMA to confirm that the path of least resistance is to the downside or that the neckline is more likely to break than to hold. Price is moving below both indicators as well, so these could hold as dynamic resistance in case support holds.

However, stochastic has been hovering around the oversold region for quite some time, so heading higher would suggest a return in bullish pressure. In that case, EURCAD might revisit the area of interest around 1.4700 or the tops at 1.4800.

RSI also looks ready to pull higher, although the oscillator has been moving sideways to reflect consolidation.

Earlier this week, the euro zone printed mostly downbeat PMI readings, particularly for the services sectors of Germany and France. This led traders to price in strong odds of an ECB pause in September, possibly marking an end to the central bank’s tightening cycle.

The upcoming speech by ECB head Lagarde in the Jackson Hole Symposium might have more clues, as dovish remarks could bring more downside for the shared currency. Upbeat rhetoric, on the other hand, could revive tightening hopes and allow the euro to regain lost ground.

Meanwhile, the Loonie and other higher-yielding currencies might be able to benefit from dovish views, as the possibility of keeping rates on hold could mean more upside for business activity and commodity demand.