CAD/JPY – stuck near 77.61 for the long term?

The Canadian dollar suffered in the foreign exchange markets last week, and its performance in its pair with the Japanese yen was no exception.

Here, the currency went down to its worst performance in around 10 weeks.

Its new-found low level, 77.61, was later left behind as the currency rose further amid an environment of resurgent bear moves.

The ultimate headline for the pair, though, is uncertainty.

It closed on Friday with a price chart movement known as a ‘Doji pattern’, which revealed just how uncertain traders of this pair are at the moment.

Potential support and resistance levels for the pair are now under close scrutiny.

Some suggest that the currency could move to a monthly support zone of around 77.25.

In the other direction, meanwhile, there is some speculation that the pair could get as high as 80.35.

Overall, the pair is believed to have a predisposition towards bears at the moment – but whether this will hold does remain to be seen.

What does the economic calendar hold over the next few days for these two important global currencies?

On Monday, the Japanese yen will be in the spotlight later in the evening as the Tokyo consumer price index – excluding fresh food – will be published at 11:30pm GMT.

This will cover the month of July and is likely to show no year-on-year change from its previous position of 0.2%.

Japanese monetary basis information will be out shortly afterwards at 11:50pm GMT.

This will also cover the month of July and is due to reveal a year-on-year change from 6% up to 6.3%.

On Tuesday, meanwhile, Canada’s manufacturing purchasing managers’ index for Markit will be out at 1:30pm GMT.

This will cover July, and is due to show a dip from 47.8 to 44.1.

On Wednesday evening, Japan will publish some insights into the state of its price levels.

The country’s producer price index for July will be out at 11:50pm GMT.

This was last recorded at 0.6% on a month-on-month basis.

On a year-on-year basis, meanwhile, the indicator was last recorded at -1.6%.

Looking ahead to Thursday, meanwhile, a release looking at the prices of newly constructed residential properties in Canada will be out at 12:30pm GMT.

This will cover the month of July.

Year on year, this was last recorded at 1.3%.

In a sign of just how difficult the coronavirus pandemic has been for the Canadian construction industry, however, it was last recorded month on month at just 0.1%.

On Friday, Japan will publish its tertiary industry index for June at 4:30am GMT.

Month on month, this was last recorded at -2.1%.

Canadian manufacturing sales data for the month of June will be out at 12:30pm GMT.

This was last recorded and published at 10.7% on a month-on-month basis.

About the author: Justin Freeman

Justin has twenty-two years' of experience working in the financial markets with brokers. He's held trading and risk management positions at boutique asset managers and large investment banks. Justin helps people understand their trading options in a clear, jargon-free manner.

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