EUR/CAD Weekly – Bull Flag Breakout with Macro Tailwinds

Technical Structure:
The sharp rally from mid-2022 to early 2024 forms the flagpole.

The tight, downward-sloping consolidation (roughly mid-2023 to early 2025) forms the flag.

The recent breakout above the 1.5800–1.6000 zone confirms the flag breakout.

📊 Key Bull Flag Characteristics Met:

Prior strong impulsive move (flagpole)

Consolidation downward/slightly sideways in a tight range (flag)

Breakout with momentum above flag resistance

🌍 Fundamentals Confirm the Technical Picture:
As outlined previously, the macro environment aligns perfectly with this bullish breakout:

🔹 Euro Strength:
ECB is easing cautiously — still relatively hawkish vs peers.

Inflation remains sticky, reducing pressure for rapid cuts.

Eurozone economic data is stabilizing, especially in manufacturing.

🔻 Canadian Dollar Weakness:
Falling oil prices hurt CAD (Canada is a petro-currency).

BoC is dovish and may begin rate cuts sooner.

Domestic economic data (housing, retail) shows cracks.

🧭 Final Summary:
✅ Flag Breakout Thesis
✅ Bull flag structure validated

✅ Clean breakout and momentum

✅ Macro drivers support sustained upside

🔔 Key Levels:
Breakout Zone: 1.5800–1.6000

🔔 What to Watch Next:
ECB July meeting commentary

Canadian employment and CPI data

Crude oil weekly inventory reports

Risk-off sentiment (which usually supports EUR over CAD)

📈 Target Projection:

If 1.6000–1.6095 breaks, we look for:

🎯 Target: 1.72 – 1.74 (mid to late 2025)

🔰 Invalidation: Break back below 1.5250