The euro currency has gained some ground against the Canadian dollar. The EUR/CAD currency exchange rate is trading higher headed into Tuesday trading around 1.4420.
Overnight European Central Bank Chief Economist Philip Lane spoke. He said that higher inflation was transitory and should fade in 2022. Dr. Lane said that current bottlenecks and energy prices will ease or stabilize during the first half of next year. This boosted the euro currency.
On the other side of the EUR/CAD Forex market, the Bank of Canada ended their monthly asset buys on 27 October. The Bank of Canada was pretty hawkish with their taper announcement. Their overall hawkish commentary surprised the markets.
As long as the Bank of Canada remains hawkish, in contrast to the European Central Bank, this should give the Canadian dollar the edge over the shared currency. Forex traders could see a series of higher lows in the EUR/CAD Forex market headed into the end of the year
Daily Euro Currency Technical Analysis
Looking at the above daily MT 4 chart, the EUR/CAD currency exchange rate, the euro seems to be trading in a range from 1.4291 to 1.4440. The shared currency is trying to correct higher but the long-term bias is to the downside.
The 50, 100 and 200 day simple moving averages are well above the current price level. Also, the 14 day relative strength index (RSI) is trending higher but below the mid-line which could keep price action around 1.44.
On the downside, immediate technical support lines up at 1.43. The next downside barrier lines up at the 16 February 2020 low price point. This support level is at 1.4263.
On the upside, a sustained close above the range top at 1.4440. This could open the door for a challenge of 1.45 before bringing the 50 day simple moving average into play near 1.4625.