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USDJPY and USDCAD aim higher, with broad US$ strength

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  • The US Dollar continues to strengthen, driven by improving economic data, most recently on Friday 27th October with the release of better than anticipated GDP.
  • US$ strength and a “risk on” scenario with equities markets surging higher has encouraged USDJPY higher, now poised at a key resistance level at 114.50.
  • For USDCAD, the recent rally has shifted the intermediate-term outlook in late October from bearish, through neutral to now bullish.

USDJPY – Bullish threat

A push higher again Friday to approach a key resistance at 114.50, and despite the setback we still see bull pressures whilst above 113.323/22 from the strong recovery effort from mid-October, to keep an upside bias Monday.

The late September push through 112.20 produced a bullish shift in the intermediate-term outlook, reinforced by bullish October price action.

For Today:

l We see an upside bias for 114.05; break here aims for 114.45 and a key target at 114.50, then 114.89.

l But below 113.32/22 quickly aims at 113.05 and opens risk down to 112.53.

Intermediate-term Outlook – Upside Risks:

l We see a positive tone with the bullish threat to 114.50

l Above here targets 115.50/63 and maybe towards 118.65.

What Changes This? Below 111.45 signals a neutral tone, only shifting negative below 109.53.

Daily USDJPY Chart

USDJPY Chart

USDCAD – Intermediate-term bullish shift and upside risks

Another push to the topside on Friday, further reinforcing Wednesday’s surge higher through the Bank of Canada Meeting and the break above key resistance at 1.2778, aiming higher again for Monday.

Furthermore, the push above 1.2778 shifted the intermediate term outlook to bullish.

For Today:

l We see an upside bias up through 1.2917 up closer to 1.2930/33.

l But below 1.2774 opens risk down to 1.2723, maybe closer to 1.2632.

Intermediate-term Outlook – Upside Risks:

l We see a positive tone with the bullish threat to 1.3015.

l Above here targets 1.3347 and 1.3550 .

What Changes This? Below 1.2429 signals a neutral tone, only shifting negative below 1.2194.

Daily USDCAD Chart

USDCAD Chart