The CAD/JPY pair rallied in the last hours and it seems determined to come back higher after its massive drop. Technically, after its strong drop, a bounce back is natural. The price action signaled a new leg higher. CAD/JPY is trading at 98.25 at the time of writing.
Today, the US Advance GDP could have an impact on CAD/JPY as well. Tomorrow, the BOJ and the Canadian GDP could really shake the market. In addition, Japan is to release Housing Starts, Retail Sales, Unemployment Claims, and Tokyo Core CPI as well.
CAD/JPY Range Pattern!
CAD/JPY extended its sell-off after activating the flag pattern. It dropped as much as 97.86 yesterday, registering a new low. Still, it has registered only a false breakdown below 97.75 former low signaling that the downside movement could be over.
In the short term, it's trapped between 98.36 and 97.75 levels. Escaping from this pattern should bring us new opportunities.
CAD/JPY Forecast!
Personally, I would like the price to test and retest the median line (ml) before resuming its growth. A bullish closure above 98.36 activates a larger growth and is seen as a bullish signal.
