Tuesday, December 18, 2018
Home > Posts > Technical Analysis – CAD/JPY penetrates ascending trend line

Technical Analysis – CAD/JPY penetrates ascending trend line

CAD/JPY 07/12/18 | EconAlerts


CAD/JPY penetrates ascending trend line; hovers above a 5-month trough.

CAD/JPY completed a five-month low of 83.55 on Thursday and had a significant bearish rally in the preceding three days. The strong bearish sentiment has pushed the price to penetrate the long-term ascending trend line to the downside, shifting the positive outlook to a more negative one.

Despite the latest pullback on price today, the technical indicators remain in the bearish territory. The MACD oscillator is strengthening its momentum below the trigger line, while the RSI indicator is flattening.

Should the pair manage to strengthen its negative momentum, the next support could come around the 61.8% Fibonacci retracement level of the up-leg from 80.53 to 89.25, around the 83.72 level. This hurdle acted as a strong support level in the previous three months, however, if the price tumbles below it, this would open the way for a downside rally towards the 82.15 level.

If prices are unable to hold below the diagonal line, the risk would shift back to the upside with the 84.60 resistance and the 50.0% Fibonacci mark of 84.87 coming into focus. A jump above the 50.0% Fibonacci would signal a resumption of the longer-term uptrend and send prices until the 38.2% Fibonacci of 85.90.

In the bigger view, the outlook has switched to neutral since prices hold below all the moving average lines and the rising trend line, which has been holding since March 19. A significant close below 83.72 would confirm the bearish bias.

CAD/JPY 07/12/18 | EconAlerts


 

TRADE THE MARKETS     TRY A DEMO ACCOUNT     US TRADERS

All trading involves risk. It is possible to lose all your capital

 


Disclaimer:
This information is not considered as investment advice or investment recommendation but instead a marketing communication. This material has not been prepared in accordance with legal requirements designed to promote the independence of investment research, and that it is not subject to any prohibition on dealing ahead of the dissemination of investment research.


Source: XM

Leave a Reply

Your email address will not be published. Required fields are marked *