USDJPY and USDCAD holding onto intermediate-term bear trends

Chris Lee

  • When last discussing USDJPY and USDCAD we highlighted intermediate-term bearish themes.
  • Since then, USDJPY initially pushed lower to reinforce the intermediate-term bearish outlook, BUT late August-early September recovery efforts have questioned the bear theme.
  • However, a shift to bullish still needs a push above 112.15 from our technical perspective.
  • Similarly, for the US Dollar versus the Canadian Dollar, the late August push down to 1.2883 enhanced the intermediate-term bear trend.
  • But the USDCAD recovery effort into early September, on the back of stalling NAFTA talks, sees risks for an intermediate-term shift to bullish, but only above 1.3290.


USDJPY Shift back to a positive tone

An initial push lower through 110.66 support Thursday/ Friday for a more negative tone, BUT then a firm intraday rebound from new support at 110.36 to ease the negative theme and shift the risks higher into Monday.

The mid-August surrender of 110.25 set an intermediate-term bear trend.

For Today:

  • We see an upside bias for 111.34; break here aims for 111.76 and 111.83/88.
  • But below 110.71 opens risk down to 110.36 and maybe towards 110.19 and 110.00.

Intermediate-term Outlook – Downside Risks: We see a downside risk for 109.35.

  • Lower targets would be 108.08, 106.88 and maybe 104.54
  • What Changes This? Above 112.15 shifts the outlook straight back to a bull theme.

Resistance and Support:

111.34 111.76* 111.83/88** 112.15*** 112.55/60*
110.71 110.36* 110.19 110.00* 109.74**

4 Hour USDJPY Chart

usdjpy chart  

USDCAD Bias stays higher

A firm rebound Friday from just above our 1.3105 support (from 1.3106) to overcome 1.3166 minor resistance, building again in the early September rally through numerous key resistance peaks (1.3160, 1.3176 and 1.3191), to keep risks higher Monday.

We see an intermediate-term bearish theme, BUT risk is growing for an intermediate-term shift to bullish above 1.3290.

For Today:

  • We see an upside bias for 1.3190 and 1.3226; break here aims for 1.3247, maybe key 1.3290.
  • But below 1.3106/05 opens risk down to 1.3037.

Intermediate-term Outlook – Downside Risks: Whilst below 1.3290 we see a downside risk for 1.2814.

  • Lower targets would be 1.2725 and 1.2536
  • What Changes This? Above 1.3290 shifts the intermediate-term outlook straight to a bull theme.

Resistance and Support:

1.3190 1.3226 1.3247* 1.3290*** 1.3351*
1.3106/05** 1.3037* 1.2961 1.2915 1.2883**

4 Hour USDCAD Chart

usdcad chart