CAD/JPY Analysis – Potential Bearish Setup
The CAD/JPY pair is showing signs of bearish momentum within a descending channel on the 1H timeframe. The recent price action indicates potential for further downside, supported by technical confirmations:
Descending Channel: The price is respecting the boundaries of a well-defined bearish channel, suggesting continued downward momentum.
Weak Low Formation: The pair has formed a weak low at 106.229, potentially signaling the market's intention to grab liquidity below this level.
Bearish Order Block: A supply zone near 107.150 is acting as strong resistance, aligned with the channel's upper boundary.
Break of Structure (BOS) and ChoCH: Multiple BOS and ChoCH patterns indicate a bearish shift in market structure, adding confidence to the downside bias.
RSI Confirmation: The RSI shows bearish divergence, further supporting the bearish outlook.
🔑 Plan:
Entry Zone: Around 106.250 (near the weak low).
Take Profit Targets:
TP1: 105.502
TP2: 104.675
Stop Loss: Above the 107.150 resistance level to limit risk.
This setup offers a favorable risk-to-reward ratio for traders looking to capitalize on CAD/JPY's bearish momentum. As always, risk management is key—trade responsibly and monitor for any unexpected market shifts.
Descending Channel: The price is respecting the boundaries of a well-defined bearish channel, suggesting continued downward momentum.
Weak Low Formation: The pair has formed a weak low at 106.229, potentially signaling the market's intention to grab liquidity below this level.
Bearish Order Block: A supply zone near 107.150 is acting as strong resistance, aligned with the channel's upper boundary.
Break of Structure (BOS) and ChoCH: Multiple BOS and ChoCH patterns indicate a bearish shift in market structure, adding confidence to the downside bias.
RSI Confirmation: The RSI shows bearish divergence, further supporting the bearish outlook.
🔑 Plan:
Entry Zone: Around 106.250 (near the weak low).
Take Profit Targets:
TP1: 105.502
TP2: 104.675
Stop Loss: Above the 107.150 resistance level to limit risk.
This setup offers a favorable risk-to-reward ratio for traders looking to capitalize on CAD/JPY's bearish momentum. As always, risk management is key—trade responsibly and monitor for any unexpected market shifts.
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