CADJPY onto short term bearish
Technically
The pair has broke the upward wedge and the price action since the start of the year when it has broke the upward wedge was the short term bearish trend with potential of up to 150 pips for a sell set-up.
Fundamentally
The pair will likely get a bearish momentum followed by the recent record breaking inflation in Canada. The central bank previously hiked rates by 100 bps but it will likely delay another hike owing to slow down in inflation expectation as a result of recent decline in oil price. Thus the existing high inflation and potential decline in speed to hike rates will likely impact and reduce the value of the Canadian Dollar in the short term until month end.
For Japan, the big Yen driver has been the CPI data and inflation which according to data it has remained elevated above central bank target of 2%, however, with the same reasons of decline in commodities prices especially oil, this will implies a potential slowdown in Japanese inflation within central bank's target which will imply Japanese Yen gaining strength.
The pair has broke the upward wedge and the price action since the start of the year when it has broke the upward wedge was the short term bearish trend with potential of up to 150 pips for a sell set-up.
Fundamentally
The pair will likely get a bearish momentum followed by the recent record breaking inflation in Canada. The central bank previously hiked rates by 100 bps but it will likely delay another hike owing to slow down in inflation expectation as a result of recent decline in oil price. Thus the existing high inflation and potential decline in speed to hike rates will likely impact and reduce the value of the Canadian Dollar in the short term until month end.
For Japan, the big Yen driver has been the CPI data and inflation which according to data it has remained elevated above central bank target of 2%, however, with the same reasons of decline in commodities prices especially oil, this will implies a potential slowdown in Japanese inflation within central bank's target which will imply Japanese Yen gaining strength.
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