Reviewing the H4 technical aspect, CADJPY has been moving downwards since the beginning of the month. Yesterday, the pair respected the trendline (T1), after the bullish rally, while it tested not only the trendline (T2), but also the 38.2% Fibonacci resistance level.
Going to more technicals, RSI is currently moving between the resistance’s [50–60] range, while Stochastics is approaching the major level of 80. Additionally, the CCI shows that it finds difficulty to break out the 100 level to the upside. Lastly, -DMI is breaking above the +DMI, while ADX indicator is less than 25, showing that the pair could still follow the downward trendline (T1).
Overall, the setup may indicate a continuation of the April’s bearish momentum towards the 23.6% Fibonacci level. A potential breakout below that level may lead the Bears to push the price lower towards yesterday’s low (level 85.42).
On the other hand, if price breaks out above the trendline (T1), then the Bulls may take the control targeting the trendline (T3).
Disclaimer: The views expressed do not constitute investment or any other advice/recommendation/suggestion and are subject to change. Reliance upon information in this material is at the sole/discretion of the reader. Opinions expressed in the report do not constitute an offer or invitation to anyone to invest or trade.