EURCAD is in the middle of a retest of a broken resistance level after a strong upside break. Applying the Fibonacci retracement tool shows nearby support levels as well.

Price is closing in on the 50% level that’s right in line with the area of interest around the 1.4680 mark. A larger pullback could last until the 61.8% level around the 1.4650 minor psychological mark. If any of these levels are enough to keep losses in check, price could recover to the swing high next.

The 100 SMA is above the 200 SMA to indicate that the path of least resistance is to the upside or that the climb is more likely to gain traction than to reverse. Price has already broken below the 100 SMA dynamic inflection point as an indication of selling pressure.

RSI is indicating oversold conditions, though, or exhaustion among sellers. Turning higher could bring buyers back in and spur a climb back to the recent highs and beyond. Stochastic is also in the oversold territory but has yet to pull up to confirm that bulls are back.

The line in the sand for a bullish correction is around the 200 SMA dynamic support that lines up with another near-term area of interest. A break below this could mean that a reversal from the climb is underway.

Euro zone PMI readings are up for release next and small gains are eyed, possibly reinforcing the view that the slowdown in the region has bottomed out. Another batch of downbeat readings, on the other hand, could mean more losses for the shared currency.

Meanwhile, Canada has its retail sales figures lined up and another set of declines are eyed, possibly supporting speculations that the BOC could join its peers in cutting interest rates.