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As a result of the ongoing from March 19, this year declines USDCAD has already overcome quite a significant level of support last week. Although the market has been fluctuating around this zone since then, the bulls had so far lacked the strength to negate the earlier breakout. If therefore, the current consolidation turns out to be only a correction, we would expect further declines to around 1.2260 or even 1.2100.
Looking at the 30-minute interval, we can see that the scenario could have taken place, the price would have to breakout out first from the consolidation lasting since last Tuesday.
The current situation on the USDJPY looks also bearish, where as a result of recent increases, the market has reached the area of the (orange) resistance zone being the lower limit of the previous consolidation. Last Friday there was a supply reaction, and if this zone will be permanently rejected, we would expect a continuation of declines.
Looking at the 60-minute interval, however, we notice that the price is currently fluctuating around the upward trend line, and only overcoming this support could open the way to further declines.
The current situation on the CADJPY is also very interesting, where as a result of the ongoing growth from March 19 this year, the market has reached the local level of resistance. There, also last Friday, was the first supply reaction and if this zone is permanently rejected, we would expect a continuation of declines.
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