Trade of the Day: CAD/JPY
By: Dima Chernovolov
CAD/JPY continues to fall inside the 4-hour Down Channel chart pattern which was previously recently by Autochartist. Autochartist rates the quality of this Down Channel at the 5-bar level – which is the result of the slow Initial Trend (3 bars), medium Uniformity (5 bars) and significant Clarity (7 bars). CAD/JPY is expected to fall further inside this Down Channel – in line with the earlier downward reversal from the round resistance level shown below.
As can be seen from the daily CAD/JPY, the price earlier reversed down sharply from the round resistance level 80.00 (former strong support level which stopped the sharp downtrend in May). The proximity of this resistance level and the strength of the active daily downward impulse from July increase the probability CAD/JPY will continue to fall inside this Down Channel.