Trade of the Day: CAD/JPY
By: Dima Chernovolov
CAD/JPY continues to fall inside the daily Rectangle chart pattern, which was previously identified by Autochartist. Autochartist rates the quality of Rectangle at the 4-bar level – which is the result of the below-average Initial Trend, Uniformity and Clarity (4 bars). CAD/JPY is expected to fall further inside this Rectangle – in line with the earlier downward reversal from the powerful resistance area shown below.
As can be seen from the weekly CAD/JPY chart below, the price earlier reversed down from the resistance area lying between the long-term resistance level 82.00 (which has been reversing the price from the start of 2020) and the upper weekly Bollinger Band. The proximity of this resistance area increase the probability CAD/JPY will continue to fall inside this Rectangle.