Trade of the Day: CAD/JPY

By: Dima Chernovolov

CHF/JPY recently broke the daily Down Channel chart pattern, which was previously identified by Autochartist. Autochartist rates the quality of this Down Channel at the 9-bar level – which is the result of the strong Initial Trend and Uniformity (10 bars) and above-average Clarity (6 bars). CHF/JPY is expected to rise toward the forecast price 117.95 – in line with the earlier breakout of the resistance area shown below.

As can be seen from the daily CHF/JPY chart below, the price earlier broke the resistance area located between the resistance levels 116.00 and 116.50 (monthly high from October) and the 61.8% Fibonacci correction of the downward price impulse from August. This price zone is acting as the support area after it was broken. The proximity of this support area increases the probability CHF/JPY will continue to rise toward the forecast price 117.95.