Since a July high of 96.22, CAD/JPY has been bearish, holding below a falling trendline seen in the 4H chart.
Last week, CAD/JPY found support at 92.75 and pulled back up. This week, price broke above the falling trendline and is threatening a reversal, or at least a bullish correction.
As price approaches 94.00, we should expect some sellers. Since the prevailing trend was bearish, we can expect some proponents of fading-a-rally.
If we get a pullback, let's plan a strategy to buy into expectation of more bullish correction. For now, the 94.50 level, 50% retracement, could be a conservative bullish target.
Let's set up a buy at 93.20, a support pivot from July 5. A break below 92.75 could be a sign of bearish continuation so let's put a stop-loss below, ie. at 92.65.
With an entry at 93.20, the stop-loss risk is 55 pips. The reward potential is 130 pips. This yields a 2.36:1 reward to risk ratio.
Trade safe, Trade well!
Last week, CAD/JPY found support at 92.75 and pulled back up. This week, price broke above the falling trendline and is threatening a reversal, or at least a bullish correction.
As price approaches 94.00, we should expect some sellers. Since the prevailing trend was bearish, we can expect some proponents of fading-a-rally.
If we get a pullback, let's plan a strategy to buy into expectation of more bullish correction. For now, the 94.50 level, 50% retracement, could be a conservative bullish target.
Let's set up a buy at 93.20, a support pivot from July 5. A break below 92.75 could be a sign of bearish continuation so let's put a stop-loss below, ie. at 92.65.
With an entry at 93.20, the stop-loss risk is 55 pips. The reward potential is 130 pips. This yields a 2.36:1 reward to risk ratio.
Trade safe, Trade well!
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