CAD/JPY: RBC Technicals Playing a Bullish Setup in CAD/JPY

RBC’s technical team goes long CAD/JPY at Y105.49 and would look to add on falls to Y104.05. They issue a target of Y109.50 and a stop loss at Y102.70.

• They note that “the CAD/JPY cross resumed a broader uptrend from the Y90.00 area back in March. The subsequent advance peaked just above Y107.00 in early June as the daily RSI study moved to overbought extremes. The resulting price consolidation since then has remained above the 55-dma and the Ichimoku Cloud while the daily RSI study has stayed above 40 - all signs of underlying bullish sentiment. As a symmetrical triangle pattern forms, pullbacks to support at Y104.06 and an ascending channel base at Y102.91 are expected to attract buying interest. A daily close above Y106.27 would confirm the symmetrical triangle pattern, with the bullish breakout favouring a re-test of the 2022 high at Y107.21. Additional resistance is located at Y109.65, followed by the channel top at Y111.31. A close below the channel base at Y102.91 will be required to derail the current uptrend.”