The CAD/JPY pair is trading in the red at 109.38 at the time of writing and it seems very heavy as the Yen Futures rebounded and boosted the JPY. From the technical point of view, the price action developed a bearish formation, so more declines are still possible. Still, we need confirmation before taking action again.
Fundamentally, the Japanese M2 Money Stock came in line with expectations, registering a 2.4% growth. Later, the US data could have a big impact on this currency pair as well. The Prelim UoM Consumer Sentiment could be reported lower at 67.2 points versus the 68.1 points estimated. Poor US data could weaken the CAD.
CAD/JPY in Up Channel!
As you can see on the H1 chart, the rate developed a new up channel pattern. This is seen as a bearish formation.
Its failure to approach and reach the upside line again signaled exhausted buyers. Now, it has dropped below the uptrend line and it stands right above the 109.28 key support.
CAD/JPY Forecast!
A bearish closure below 109.28 activates more declines and is seen as a selling opportunity.
