CADJPY Recovers Some Losses with Weak Momentum

Technical analysis of Forex market

CADJPY is in the process to recover some of its aggressive losses that posted at the beginning of the previous month. The 50-day simple moving average (SMA) acted as a crucial support level for the price, while the RSI and the stochastic are moving slightly higher. However, the red Tenkan-sen line is holding beneath the blue Kijun-sen line, suggesting possible losses in the short-term.

In case that the price remains above the moving averages it could challenge the 79.95 resistance, being the 23.6% Fibonacci retracement level of the upward wave from 73.75 to 81.90. A rally above this hurdle could hit the 81.90 high.

Otherwise, a strong fall below the 20-day SMA and the 38.2% Fibo of 78.78 could open the door for the 78.10 support, which overlaps with the 50-day SMA. If the bears continue to sell the pair, the next barrier is coming from the 50.0% Fibo of 77.83 and the 61.8% Fibo of 76.90.

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In brief, CADJPY has failed to improve the bullish structure that started from the rebound on 73.75. A jump above 81.90 could boost sentiment for more gains.