A few days ago CADJPY hit a confluence of resistance at 83.80.
It’s the intersection of ascending channel resistance and a horizontal level that served as support between August and December of last year.
Since Monday’s commentary, CADJPY is down 100 pips. It’s also currently testing the channel support I mentioned at 82.70.
It’s going to take a close below this level to extend this week’s losses.
The pair is also just 40 pips away from carving a bearish engulfing candle for the week. And with less than 48 hours to go, we’ll know the outcome soon enough.
Note that you can also watch for a 4-hour close below channel support. It may serve as an early warning sign of a future breakdown.
That said, a daily close below the 82.60/70 area would be much more convincing.
As for targets following a breakdown, I’d keep an eye on 80.55 followed by 78.70.
Alternatively, a bounce from 82.60/70 would keep the channel intact. It would also expose the 84.50 area.
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