CADJPY stays caught in a longer-term downtrend that leaves it weak every time the chart begins to tilt to the draw back. The excessive final month got here at a trend-line operating down off the March excessive, this was met with a sequence of rejection candles. Once more, a flip decrease creating off the trend-line within the type of a decrease excessive.
Nonetheless, there was nonetheless a constructive tone off the June low in place with a bottom-side parallel preserving CADJPY supported inside an upward channel. After yesterday’s turnabout we’re seeing the channel line come below hearth in at present’s session. A break after respecting considerably will increase odds that one other leg decrease will develop quickly.
Furthering alongside the case for shorts is the bear-flag/channel forming on the Four-hr time frame. It’s presently testing the under-side parallel. A break of the parallel and low at 8213 will open up a path in the direction of decrease ranges. The decrease parallel off the July excessive will have to be monitored, however a breach by there’ll seemingly steepen the sell-off.
General, the chart is leaning decrease and if latest assist breaks it could be time to prime up for an additional leg in the direction of long-term assist through a trend-line from late 2016 with stops probably at simply above 81 and 8060. If the latest low at 8213 holds, then so does a bearish bias with an alternate route probably creating through a descending wedge.
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CADJPY Every day Chart (chart tilting decrease)
CADJPY Four-hr Chart (flagging on decrease parallel)
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—Written by Paul Robinson, Market Analyst
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