On Tuesday CADJPY reached 1.5 month high at 79.65. Not much higher because already in the region of 79.80 we have resistance, which has repeatedly been in game this year and soon retest should appear again. On the other hand we can see approaching from the bottom bullish trend line. This line was today tested and currently remains an open question whether bears will be able to break it.
Appreciation observed for more than three weeks runs on CADJPY at a fairly large angle and therefore it is possible that the bulls will not be able any longer to maintain that momentum. This would mean that before breaking resistance at 79.80 a deeper correction can happen.
In that moment we should observe two levels. From the bottom – area of 78.90 which coincides with a line of the uptrend with strong support and from the top- area 79.80 – 80.20. This first level 79.80 played an important role in previous months and this time also has a chance to trigger a correction, while 80.20 is the Septembers high.