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CADJPY bullish momentum | 10th Jan 2022 We can expect price to bounce from the pivot level in line with 38.2% Fibonacci retracment towards take profit level in line with 161.8% Fibonacci extension. Our bullish bias is further supported by the prices holding above the Ichimoku cloud. Any opinions, news, research, analyses, prices, other information, or links to third-party sites contained on this website are provided on an "as-is" basis, as general market commentary, and do not constitute investment advice. The market commentary has not been prepared in accordance with legal requirements designed to promote the independence of investment research, and it is therefore not subject to any prohibition on dealing ahead of dissemination. Although this commentary is not produced by an independent source, FXCM takes all sufficient steps to eliminate or prevent any conflicts of interest arising out of the production and dissemination of this communication. The employees of FXCM commit to acting in the clients' best interests and represent their views without misleading, deceiving, or otherwise impairing the clients' ability to make informed investment decisions. For more information about the FXCM's internal organizational and administrative arrangements for the prevention of conflicts, please refer to the Firms' Managing Conflicts Policy. Please ensure that you read and understand our Full Disclaimer and Liability provision concerning the foregoing Information, which can be accessed on the website.
Long
by Rockqet
CAD JPY - FUNDAMENTAL DRIVERSCAD FUNDAMENTAL BIAS: NEUTRAL 1. Monetary Policy In Dec the BoC left rates at 0.25% as expected and maintained forward guidance where it expects rates at current levels until the middle quarters of 2022. Even though the bank still thinks inflation will ease from 2H22, they did drop the term "temporary" when referring to price pressures, similar to the Fed’s drop of the word transitory. The bank took a slightly bleaker view on growth, pointing to both the new Omicron variant and flooding in British Columbia as possibly drags on growth and something that could elevate supply chain issues. What disappointed markets a bit was that the bank said none of the recent developments warrants any further adjustments to normalization, which disappointed the bulls looking for a possible hawkish tilt. The bank noted that employment is back to pre-covid levels, and economic momentum in Q4 were solid, but the overall tone wasn’t enough to convince markets of a 1Q22 hike, with market odds at roughly 50/50 for the Jan meeting. The recent Omicron restrictions is expected to hit growth in the first quarter, which means a hike in quarter 2 is more likely as the bank would arguably not be in too much of a hurry to turn overly aggressive given the divergence between the divergent government response to Omicron between the US and the BoC . Thus, we think the bank holds off with hikes until 2Q22, which means some of those aggressive policy bets (markets pricing in very close to 5 hikes for this year this past week) will arguably need to be pushed back and repriced. 2. Intermarket Analysis Considerations Oil’s massive post-covid recovery has been impressive, driven by three drivers: supply & demand (OPEC’s production cuts); improving global economic outlook and improving oil demand outlook, even though slightly pushed back by Delta concerns; higher for longer than expected inflation . Even though Oil has recovered a lot of its recent downside and have proven our caution wrong, we are still cautious going into the first two quarters. The drivers keeping us cautious on oil right now is expectations of a more hawkish Fed, slowing growth and inflation , and a possible supply surplus in 1Q22. If our concerns do materialize into downside for oil prices it should put pressure on the CAD. Recent supply constraints in Kazakhstan and Libya has aided oil this past week (alongside some higher inflation inputs), and if that continues it could provide continued short-term support for Oil though so worth keeping that in mind. 3. Global Risk Outlook As a high-beta currency, the CAD benefited from the market's improving risk outlook coming out of the pandemic as participants moved out of safe-havens. As a pro-cyclical currency, the CAD enjoyed upside alongside other cyclical assets supported by reflation and post-recession recovery best. If expectations for the global economy remains positive the overall positive outlook for risk sentiment should be supportive for the CAD in the med-term , but recent short-term jitters are a timely reminder that risk sentiment is also a very important short-term driver. 4. CFTC Analysis Latest CFTC data showed a positioning change of -691 with a net non-commercial position of -11025. A lot of the previous froth priced into the CAD has arguably been reduced. However, given our concerns about Oil as well as the bar for an aggressive policy response from the BoC looking less certain, we do think there is chance of some additional repricing for the CAD going into 2022, which is why we’ve shifted our fundamental outlook to neutral from weak bullish . 5. The Week Ahead In the week ahead the calendar is very slim for the CAD with no tier 1 data points. The good jobs print on Friday provided some additional upside for the CAD, which had a decent start to the new year. However, as employment is often seen as a lagging indicator, as well as the newly announced covid restrictions in Canada, we do think the growth and employment situation in 1Q22 is facing some deterioration. For now, the markets have seemed comfortable with that and the CAD has been very resilient, but we are not sure how long that can continue. JPY FUNDAMENTAL BIAS: BEARISH 1. Monetary Policy At their Dec meeting the BoJ kept policy mostly unchanged apart from unanimously voting to scale back emergency pandemic relief funding from March which includes tapering corporate bond and commercial paper buying, but they did also vote to extend a portion of the pandemic relief loan scheme to March for smaller firms. As always, the BoJ said they are ready to add additional stimulus and easing steps as the economy needs it. The bank reiterated that even though the economy has picked up it does still remain in a severe situation due to the COVID-19. The bank remains dovish and is unlikely going to change anytime soon. 2. Safe-haven status and overall risk outlook As a safe-haven currency, the market's risk outlook is the primary driver of JPY. Economic data rarely proves market moving for the JPY; and although monetary policy expectations can still prove marketmoving in the short-term, safe-haven flows are typically the more dominant factor. The market's overall risk tone has improved considerably following the pandemic with ongoing monetary and fiscal policy support paved the way for markets to expect a robust global economic recovery. As the Fed and other banks start to normalize, we do need to remember that it means those fiscal and monetary policy support is being reduced, which could mean a lot more volatility for markets in the weeks and months ahead. Even though that doesn’t mean our med-term bias for the JPY has changed, it simply means that we should expect more risk sentiment ebbs and flows this year, and the heightened volatility can create some fantastic directional moves in the JPY, as long as yields play their part. 3. Low-yielding currency with inverse correlation to US10Y As a low yielding currency, the JPY usually shares a strong inverse correlation to moves in yield differentials, more specifically in strong moves in US10Y . However, like most correlations, the strength of the inverse correlation between the JPY and US10Y isn’t perfect and will ebb and flow depending on the type of market environment from both a risk and cycle point of view. With the Fed tilting more aggressive, we think that opens up more room for curve flattening to take place with US02Y likely pushing higher while US10Y underperform. In this environment we do see some mild upside risks for the JPY, but we should not look at the influence from yields in isolation and also weigh it up alongside underlying risk sentiment and price action in the USD of course. 4. CFTC Analysis Latest CFTC data showed a positioning change of -9160 with a net non-commercial position of -62262. Even though the JPY’s med-term outlook remains bearish , the big net-shorts for both large speculators and leveraged funds always increases the odds of more punchy safe haven flows and mean reversion when risk sentiment deteriorates. However, despite risk sentiment taking a hit in the past trading week, the JPY has remained pressured as the move in US yields kept any JPY rallies in check. 5. The Week Ahead In the week ahead the biggest focus for the JPY will be on overall risk sentiment with the big rally in risk sentiment going into the last few trading days of the year with S&P futures managing to squeeze out another all-time high and Nasdaq futures getting very close to doing the same. The big amount of upside has been mostly attributed to equities taking the path of least resistance ( med-term bias remains tilted higher) and moves was probably exacerbated by thinner liquidity and lower volumes. If that momentum can continue at the start of the new year, we can expect to see further downside for the safe haven JPY and will be a key focus for the currency for the week ahead. Apart from that, keeping an eye on US yields will be important as always.
by thunderpips
2
CADJPY bullish momentum | 5th Jan 2022Price broke out of the descending trendline resistance, signifying a bullish momentum. We can expect price to push higher from the pivot level in line with 38.2% Fibonacci retracement towards the take profit level in line with 161.8% Fibonacci retracement. Our bullish bias is further supported by the price holding above the Ichimoku Cloud and RSI indicator where it is abiding to the ascending trendline support. Any opinions, news, research, analyses, prices, other information, or links to third-party sites contained on this website are provided on an "as-is" basis, as general market commentary, and do not constitute investment advice. The market commentary has not been prepared in accordance with legal requirements designed to promote the independence of investment research, and it is therefore not subject to any prohibition on dealing ahead of dissemination. Although this commentary is not produced by an independent source, FXCM takes all sufficient steps to eliminate or prevent any conflicts of interest arising out of the production and dissemination of this communication. The employees of FXCM commit to acting in the clients' best interests and represent their views without misleading, deceiving, or otherwise impairing the clients' ability to make informed investment decisions. For more information about the FXCM's internal organizational and administrative arrangements for the prevention of conflicts, please refer to the Firms' Managing Conflicts Policy. Please ensure that you read and understand our Full Disclaimer and Liability provision concerning the foregoing Information, which can be accessed on the website.
by Rockqet
CADJPY bullish breakout | 31st Dec 2021Price broke out of the descending trendline resistance, signifying an overall bullish momentum. We can expect price to bounce from pivot level in line with 23.6% Fibonacci retracement towards take profit level in line with 127.2% Fibonacci projection. Our bullish bias is further supported by the Ichimoku cloud indicator where price ids holding above it. Any opinions, news, research, analyses, prices, other information, or links to third-party sites contained on this website are provided on an "as-is" basis, as general market commentary, and do not constitute investment advice. The market commentary has not been prepared in accordance with legal requirements designed to promote the independence of investment research, and it is therefore not subject to any prohibition on dealing ahead of dissemination. Although this commentary is not produced by an independent source, FXCM takes all sufficient steps to eliminate or prevent any conflicts of interest arising out of the production and dissemination of this communication. The employees of FXCM commit to acting in the clients' best interests and represent their views without misleading, deceiving, or otherwise impairing the clients' ability to make informed investment decisions. For more information about the FXCM's internal organizational and administrative arrangements for the prevention of conflicts, please refer to the Firms' Managing Conflicts Policy. Please ensure that you read and understand our Full Disclaimer and Liability provision concerning the foregoing Information, which can be accessed on the website.
Long
by Rockqet
1
⚜CADJPY SHORT 430pipsHello Traders, 🙋‍♂️🙋‍♂️🙋‍♂️ Here we have a CADJPY long trade idea. If you like this idea please show your support! JPY The Japanese Yen ( JPY ) has been very weak recently however we are anticipating JPY strength soon which will push this pair further down. This weakness can also be seen in my other ideas, such as GBPJPY which correlated with this pair. CAD The Canadian Dollar ( CAD ) has been very strong recently. We have been approaching our trendline for some time and we have been anticipating another touch. We shorted in this location as we can see a trendline & a structure level. CADJPY has been dropping for some time, this can be seen on my 750 pip CADJPY short idea shared a few months ago. We are expecting some strength in this currency as we are expecting a correction. CADJPY Shared 20/10/21 In this trade we are risking 30 pips to secure 430 pips! This has given us a RISK:REWARD of 1:14.33! This is an insane return for the tiny risk. If you want to improve your trading, check out my other ideas! 📲 Please trade with caution and make sure you set your stop losses! Happy Trading 😁 Be sure to check out my other ideas below! ⚜⚜⚜⚜⚜
Short
by Pips-Collector
CADJPY is on bearish momentum! | 28 Dec 2021Price is on bearish momentum. We see the potential for a dip from our sell entry at 90.216 which is an area of Fibonacci confluences towards our Take Profit at 89.389 23.6% Fibonacci retracement. RSI is a at a level where dips previously happened. Any opinions, news, research, analyses, prices, other information, or links to third-party sites contained on this website are provided on an "as-is" basis, as general market commentary, and do not constitute investment advice. The market commentary has not been prepared in accordance with legal requirements designed to promote the independence of investment research, and it is therefore not subject to any prohibition on dealing ahead of dissemination. Although this commentary is not produced by an independent source, FXCM takes all sufficient steps to eliminate or prevent any conflicts of interest arising out of the production and dissemination of this communication. The employees of FXCM commit to acting in the clients' best interests and represent their views without misleading, deceiving, or otherwise impairing the clients' ability to make informed investment decisions. For more information about the FXCM's internal organizational and administrative arrangements for the prevention of conflicts, please refer to the Firms' Managing Conflicts Policy. Please ensure that you read and understand our Full Disclaimer and Liability provision concerning the foregoing Information, which can be accessed on the website.
Short
by Rockqet
CADJPY potential for bearish reaction! | 27 Dec 2021Prices are on bearish momentum and consolidating at an area of Fibonacci confluences. We see the potential for a short entry at 89.462 in line with our descending trendline and are of Fibonacci confluences towards our Take Profit at 88.283 in line with 61.8% Fibonacci retracement and graphical swing low. Price is trading below our MA and also Ichimoku further supports our bearish bias. Any opinions, news, research, analyses, prices, other information, or links to third-party sites contained on this website are provided on an "as-is" basis, as general market commentary, and do not constitute investment advice. The market commentary has not been prepared in accordance with legal requirements designed to promote the independence of investment research, and it is therefore not subject to any prohibition on dealing ahead of dissemination. Although this commentary is not produced by an independent source, FXCM takes all sufficient steps to eliminate or prevent any conflicts of interest arising out of the production and dissemination of this communication. The employees of FXCM commit to acting in the clients' best interests and represent their views without misleading, deceiving, or otherwise impairing the clients' ability to make informed investment decisions. For more information about the FXCM's internal organizational and administrative arrangements for the prevention of conflicts, please refer to the Firms' Managing Conflicts Policy. Please ensure that you read and understand our Full Disclaimer and Liability provision concerning the foregoing Information, which can be accessed on the website.
Short
by Rockqet
CADJPY bearish continuation | 23rd Dec 2021Price is abiding to the descending trendline resistance, signifying an overall bearish momentum. We can expect price to drop from the pivot level in line with 61.8% Fibonacci projection towards take profit level in line with 78.6% Fibonacci projection. Our bearish bias is further supported by the stochastic indicator where the the %K line is at the resistance level. Any opinions, news, research, analyses, prices, other information, or links to third-party sites contained on this website are provided on an "as-is" basis, as general market commentary, and do not constitute investment advice. The market commentary has not been prepared in accordance with legal requirements designed to promote the independence of investment research, and it is therefore not subject to any prohibition on dealing ahead of dissemination. Although this commentary is not produced by an independent source, FXCM takes all sufficient steps to eliminate or prevent any conflicts of interest arising out of the production and dissemination of this communication. The employees of FXCM commit to acting in the clients' best interests and represent their views without misleading, deceiving, or otherwise impairing the clients' ability to make informed investment decisions. For more information about the FXCM's internal organizational and administrative arrangements for the prevention of conflicts, please refer to the Firms' Managing Conflicts Policy. Please ensure that you read and understand our Full Disclaimer and Liability provision concerning the foregoing Information, which can be accessed on the website.
Short
by Rockqet
CADJPY potential for reversal | 16th DecPrice is abiding by the descending trendline and near buy entry level of 88.212 which is also 61.8% Fibonacci retracement and 61.8% Fibonacci projection. Price can potentially go to the take profit level of 90.288 which is also 78.6% Fibonacci projection . Our bullish bias is supported by the stochastic indicator as it is on support level. Any opinions, news, research, analyses, prices, other information, or links to third-party sites contained on this website are provided on an "as-is" basis, as general market commentary, and do not constitute investment advice. The market commentary has not been prepared in accordance with legal requirements designed to promote the independence of investment research, and it is therefore not subject to any prohibition on dealing ahead of dissemination. Although this commentary is not produced by an independent source, FXCM takes all sufficient steps to eliminate or prevent any conflicts of interest arising out of the production and dissemination of this communication. The employees of FXCM commit to acting in the clients' best interests and represent their views without misleading, deceiving, or otherwise impairing the clients' ability to make informed investment decisions. For more information about the FXCM's internal organizational and administrative arrangements for the prevention of conflicts, please refer to the Firms' Managing Conflicts Policy. Please ensure that you read and understand our Full Disclaimer and Liability provision concerning the foregoing Information, which can be accessed on the website.
Long
by Rockqet
CADJPY Long Idea CADJPY has recently seen a 2.23% sell-off in the direction of the key support level of 87.372. The last time that the price reached this level there was a 2.78% rise in price to the 90.388 area. CADJPY has been in a downtrend since the 21st of October and has traded underneath the overhead resistance since. The price is currently trading at 88.374, and appears to be approaching the key support level mentioned above. The RSI indicators on the 4hr chart are showing oversold levels (11.34) which shows that price could rise from this point. Today at 1:30 pm, the CAD inflation YoY rate data will be released. A reading higher than the 4.7% consensus could mean CAD pairs will rise which complies with this long analysis. Later on today JPY's Balance of Trade will be released which will impact CADJPY, a reading higher than the -¥675B consensus which is bullish for JPY and bearish for CADJPY. The target for this trade is at 90.346 with a stop at 87.427.
Long
by Orion-Markets
CADJPY bearish continuation | 7th Dec 2021 Price is abiding to the descending trendline on the daily, signifying an overall bearish momentum. We can expect price to drop from the pivot level in line with 127.2% and 50% Fibonacci retracement towards take profit level in line with 78.6% Fibonacci projection and horizontal swing lows. Our bearish bias is further supported by the Ichimoku Cloud where price is holding below it. Any opinions, news, research, analyses, prices, other information, or links to third-party sites contained on this website are provided on an "as-is" basis, as general market commentary, and do not constitute investment advice. The market commentary has not been prepared in accordance with legal requirements designed to promote the independence of investment research, and it is therefore not subject to any prohibition on dealing ahead of dissemination. Although this commentary is not produced by an independent source, FXCM takes all sufficient steps to eliminate or prevent any conflicts of interest arising out of the production and dissemination of this communication. The employees of FXCM commit to acting in the clients' best interests and represent their views without misleading, deceiving, or otherwise impairing the clients' ability to make informed investment decisions. For more information about the FXCM's internal organizational and administrative arrangements for the prevention of conflicts, please refer to the Firms' Managing Conflicts Policy. Please ensure that you read and understand our Full Disclaimer and Liability provision concerning the foregoing Information, which can be accessed on the website.
Long
by Rockqet
2
CAD JPY - FUNDAMENTAL DRIVERSCAD FUNDAMENTAL BIAS: WEAK BULLISH 1. The Monetary Policy outlook for the BoC At their Oct meeting the BoC surprised to put an early end to QE purchases and updated forward guidance to suggest an earlier lift off in rates by explaining that project economic slack to be absorbed by the middle quarters of 2022. The initial reaction was bullish as one would expect but the biggest risk to further upside for the CAD from here is the fact that a lot of these positives that was confirmed by the BoC has already been reflected in both the CAD and rates markets over the past few weeks. The CAD has seen a similar run to the upside back in 1Q21 with the BoC’s hawkish tilt, and similarly to that we feel current prices for rates and the CAD already reflect a great deal of the positives. Thus, even though the med-term outlook remains tilted to the upside for the CAD, there is the risk of seeing some unwind of the recent upside and is something to be mindful of when making any med-term allocations to the upside in the CAD. Last week’s Oct CPI data was a good example of this where the currency saw outsized downside on an uninspiring print. It’s not that CPI was bad, it was broadly in line with expectations, but with all the positives already priced it would have taken a really exceptionally strong print to keep the CAD’s upside momentum going. Another interesting driver for the months ahead, which could put a break on the BoC’s hiking path, is the close to 350% debt to GDP for Canada, which will make it very painful if rates start rising and for some like HSBC means the hike cycle could be very short. 2. Commodity-linked currency with dependency on Oil exports Oil’s massive post-covid recovery has been impressive, driven by three drivers: supply & demand (OPEC’s production cuts); improving global economic outlook and improving oil demand outlook, even though slightly pushed back by Delta concerns; rising inflation expectations. Even though further gains for Oil will arguably prove to be an uphill battle, the bias remains higher in the med-term as long as current supportive factors and drivers remains intact. 3. Developments surrounding the global risk outlook. As a high-beta currency, the CAD benefited from the market's improving risk outlook coming out of the pandemic as participants moved out of safe-havens. As a pro-cyclical currency, the CAD enjoyed upside alongside other cyclical assets supported by reflation and post-recession recovery best. If expectations for the global economy remains positive the overall positive outlook for risk sentiment should be supportive for the CAD in the med-term , but recent short-term jitters are a timely reminder that risk sentiment is also a very important short-term driver. JPY FUNDAMENTAL BIAS: BEARISH 1. Safe-haven status and overall risk outlook As a safe-haven currency, the market's risk outlook is the primary driver of JPY. Economic data rarely proves market moving; and although monetary policy expectations can prove highly market-moving in the short-term, safe-haven flows are typically the more dominant factor. The market's overall risk tone has improved considerably following the pandemic with good news about successful vaccinations, and ongoing monetary and fiscal policy support paved the way for markets to expect a robust global economic recovery. Of course, there remains many uncertainties and many countries are continuing to fight virus waves, but as a whole the outlook has kept on improving over the past couple of months, which would expect safe-haven demand to diminish and result in a bearish outlook for the JPY. 2. Low-yielding currency with inverse correlation to US10Y As a low yielding currency, the JPY usually shares an inverse correlation to strong moves in yield differentials, more specifically in strong moves in US10Y . However, like most correlations, the strength of the inverse correlation between the JPY and US10Y is not perfect and will ebb and flow depending on the type of market environment from a risk and cycle point of view. With bond yields looking a bit stretched at the current levels any decent mean reversion is expected to be supportive for the JPY, so it remains a key asset class to keep track. Currently we do see more downside risks compared to upside risks for US10Y as we think markets have been too aggressive for what they have priced in for the Fed for 2022. If yields continue to drift lower as we saw on Friday last week, that could see further JPY gains and remains a key asset to keep track of.
by thunderpips
17