EUR/CAD reaches a new year-to-date low at 1.4162 amid high oil prices and EU coronavirus woes

  • EUR/CAD slides for the fifth day in a row, amid high oil prices.
  • Eurozone coronavirus woes and reimposing of restrictions threatens to derail the EU economic growth.
  • EUR/CAD: Bears eye the 1.4100 figure as Eurozone economic and health conditions deteriorate.

The EUR/CAD slides for the fifth consecutive day, barely down some 0.01% trading at 1.4185, during the day at the time of writing. Market sentiment is a mixed bag, as Asian equity futures fluctuate between gainers and losers. In the FX market, risk-sensitive currencies fall, except for the Canadian dollar, underpinned by elevated crude oil prices.

The US crude oil benchmark, the Western Texas Intermediate (WTI), climbs 0.13%, trading at $78.16, after the US and its Asian allies tap oil from the SPR reserves, as the White House tries to stabilize rising gasoline prices throughout the country.

On Wednesday, during the overnight session, the EUR/CAD reached a daily high of around 1.4269. However, rising coronavirus cases throughout the northern hemisphere in Europe as the winter season approaches weighed on the shared currency, as the pair plummeted towards a new year-to-date new low at 1.4162. Countries like Austria -imposing a 20-day lockdown-, France, and Germany, are studying making vaccines mandatory.

Also, the Eurozone economic docket witnessed the fall of Germany’s IFO survey, which showed that the Business Climate shrank to 96.5, falling for the fifth month in a row.

EUR/CAD Price Forecast: Technical outlook

The EUR/CAD has a bearish bias in the daily chart, as depicted by the daily moving averages (DMA’s) with a downward slope, residing above the spot price. Also, the Relative Strength Index (RSI), a momentum indicator, is at 34, below the 50-central line, aiming lower, confirming the bearish bias.

In the outcome of a downtrend continuation, the first support would be the 1.4100 figure. A breach of that level would expose crucial long-term support levels, like the April 2020 swing low around 1.4052, followed by the February 2017 swing low around 1.3783.
 

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