Key Points
- The Euro recently fell towards 1.3825 against the Canadian Dollar where it found support.
- There is a crucial bearish trend line with resistance at 1.3900 on the hourly chart of EURCAD, which is preventing an upside break.
- This past week in Canada, the Consumer Price Index (CPI) for Jan 2017 was released by the Statistics Canada.
- The result was better than the forecast, as there was a rise of 2.1% in Jan 2017 (YoY), more than the forecast of 1.6%.
EURCAD Technical Analysis
The Euro faced a lot of offers against the Canadian dollar recently, resulting in a decline towards 1.3825 from there the EURCAD pair recovered. The pair is now above the 23.6% Fib retracement level of the last decline from the 1.3918 high to 1.3825 low.
However, the pair is struggling to close above the 21 simple moving average and the 50% Fib retracement level of the last decline from the 1.3918 high to 1.3825 low. Moreover, there is a crucial bearish trend line with resistance at 1.3900 on the hourly chart.
So, there is a chance of the EURCAD pair moving higher, but it is likely to face sellers near the 1.3900 handle.
Canadian Consumer Price Index
This past Friday, the Canadian Consumer Price Index (CPI) for Jan 2017 was released by the Statistics Canada. The market was expecting the Canadian CPI to increase by 1.6% in Jan 2017, compared with the same month a year ago.
The outcome was better than the forecast, as there was a rise of 2.1% in Jan 2017 (YoY). The monthly change was also better with a rise of 0.9%, compared with the 0.3% forecast. The report added that the “transportation index rose on a year-over-year basis, up 6.3% in January after a 3.0% gain in December. The gain in January was led by gasoline prices, which posted their largest increase since September 2011, up 20.6% in the 12 months to January”.
Overall, the market sentiment is favoring a minor upside in EURCAD with resistance at 1.3900 and support at 1.3845.
