EURCAD broke to the downside the medium-term sideways range that had been confining the price action in recent months, with an upper bound at 1.4770 and a lower end at 1.4415. The pair is now testing the 3-year low of 1.4350, another violation of which could give the bears more fuel.

Short-term momentum oscillators also paint a bearish picture, with the RSI looking ready to test its 30 line and the MACD moving further beneath its red trigger line and into the negative territory.

If sellers pierce below 1.4350, their next target might be the 1.4240 zone, marked by the lows of March 16, 2016. Another negative break would turn the focus to 1.4050, the level that halted the downfall back in April 2016.

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On the upside, the bulls would need to overcome 1.4415 first, which stopped the decline back in September and may now provide resistance. Further up, the lower bound of the former range at 1.4450 would be eyed, with another upside break opening the door for the 50-day simple moving average (SMA) at 1.4556 initially, and then for the inside swing high of 1.4620.

In short, the downward violation of the range has turned the outlook negative, and another break below 1.4350 would reinforce that view.

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