For the past few weeks, NZDCAD has been my major pair of focus. It sold off earlier last week, to which I exited at the peak. This week, I am prepared for a re-entry expecting a bullish upside.
The doji formed half a day ago coincidentally touched the daily level that I have been monitoring. This level held supported back in January 15 and 17 respectively and I expected it to hold up again. While some could argue it is too early too tell, this week’s market open gap down failed to follow through. Price gapped lower on open, but made significant recoveries today. I am taking an aggressive approach expecting this gap to be filled as short sellers cover their positions for the week ahead. Over on the long term time-trend, the uptrend continues to be respected.
Earlier last week, the Japanese yen broke through a significant resistance level that previously held up back in late November of 2017. Unfortunately, I missed the breakout last week. Currently, this pair is teasing another support zone which I plan on just monitoring at the moment. The selling pressure has died down over on the 4-hour time frame as we can visually see weaker and weaker down ticks failing to push prices lower. There are no major Bank of Japan releases scheduled for this week, but non-farm payrolls is due this Friday so I cannot consider this as a pure technicals play.
Similarly, EURJPY is also teasing a support level. For the second half of last year, this pair remained in a rather long consolidation and finally broke above this range in 2018. From a technical perspective, this pair also has the potentials for a long entry as this level seems to be holding up. Price did sell off lower, but recovered in its intra-day trading.
Finally, I shorted into this pair for a quick entry and exit. Similar pattern like over on USDJPY, price is currently testing a weaker support turned resistance level. I don’t expect to hold this trade for over two days just because a major sell-off already occurred so any continuation is not expected to last nearly as long. This is strictly a technical play as well, but disappointing inflation figures in tonight’s release may send this pair even lower. I will be keeping an eye on the CPI figures tonight at 7:30pm.