CAD/JPY Up 7 Pips; Nears 20, 50 and 100 Day Moving Averages

CAD/JPY Price Recap

CAD/JPY enters today at 82.835 in US dollars, up 7 pips (0.08%) from the day prior. This move happened on fewer tick price changes which may be a proxy for volume, as yesterday’s total tick count was down 30.77% from the day before — and down 41.02% from the same day the week before. Relative to other instruments in the Forex asset class, CAD/JPY ranked 14th yesterday in terms of percentage price change. The price chart of CAD/JPY below illustrates.

CAD/JPY Technical Analysis

Coming into today the current price of CAD/JPY is sitting close to its 20, 50, 100 and 200 day moving averages; moving average crosses often indicate a change in momentum, so this may be worth keeping an eye on. As for the alignment of the moving averages, well, it’s a bit mixed up; the 20, 50, 100, and 200 do not progress from largest to smallest, or vice versa. The closest is the 20 day average, which is 1.3 pips away. Volatility for CAD/JPY has been contracting over the past two weeks relative to volatility over the past month. Whether volatility reverts will be something to watch. The clearest trend exists on the 14 day timeframe, which shows price moving up over that time. It should be noted, though, that a trend in the opposite direction, going down, exists on the 30 day timeframe. Or to simplify this another way, note that out of the past 10 days CAD/JPY’s price has gone up 6 them.

A final note on correlations: in the recent most week, the currency pair bearing the strongest correlation to CAD/JPY has been CAD/CHF — a frequent scenario, considering CAD finds itself in both pairs. On the flip side, in terms of pairs with the least correlation to CAD/JPY, look no further than USD/SEK if you’re focused on just this past week, or NZD/CAD for a look at a broader, two week window.

The View From Around the Web

We’re seeing some traders come out with interesting conviction on CADJPY, with 8 buy signals on our radar and 12 sell signals. This imputes a buy/sell ratio of 0.67, which is bearish. As for the rationale, technical traders seem to be citing the appearance of a trendline technical pattern. Here’s a piece we found on tradingview.com; below is a short snippet from it to give you a taste.

so in general i still think this pair will rise again to mentioned level before seeing any bearish continuation….furthermore, in that place is when the magic will happen, a double top probably or any bearish reversal pattern may happen, and surely, i wll short it….this one of the pairs that have the potential of a +500 pips downside rally in the upcoming weeks.