The CADJPY is more than 100 pips above the 81.80 support area I discussed in the October 12 Forex forecast video.
I also wrote a post on the 14th where I pointed out the potential for a 400-pip rally to end 2019.
Although buyers have a long way to go, the pair is well on its way.
Notice too how CADJPY is bouncing from 82.50 support.
I mentioned this minor support area in Saturday’s forecast video.
However, buyers are approaching what I would consider their first critical test at 83.20.
The 83.20 region capped the pair’s advance during the first half of July.
It also served as a key pivot between April 2 and May 1.
With that in mind, there’s a very good chance we will see sellers defend 83.20 once again as resistance.
But we also have to think about the upcoming results of Canada’s elections.
Most expect preliminary results to be out sometime after 8 pm EST.
I don’t trade the news, but I do know when high-impact events are scheduled, and a country’s elections certainly qualify.
With this in mind, it’s best to prepare for an increase in volatility within the next few hours.
However, just like any market, the resulting price action for CADJPY will tell the story.
If we see CADJPY carve bearish price action from 83.20 such as a pin bar or engulfing candle, we could see a return to 82.50.
A close below 82.50 would signal short-term weakness and also open the door to 81.80.
Alternatively, a daily close above 83.20 would expose 84.20.
My objective for CADJPY remains 85.20/50.
Watch this section of the October 12 forecast to see why 85.20/50 is an incredibly significant area for the pair.
As long as CADJPY is carving higher highs and higher lows, I have to respect the potential for a push higher.
Just remember that no market moves in a straight line, and nothing is guaranteed.
It may take weeks or even months for the pair to hit the objective at 85.20/50, or it may not reach it at all.
Either way, I have to stay bullish CADJPY as long as the pair is carving higher highs and higher lows.
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