Should we keep an eye on the direction of the CAD/JPY pair, given its limited downside?
07.03.2023
- German Manufacturing Orders
- Housing Prices in Halifax, UK
In the previous day’s U.S. trading session, the Canadian dollar weakened against the U.S. dollar but remained range-bound against the yen. The CAD/JPY pair traded sideways between 99.594 and 100.088, showing a lack of directional momentum.Technically, the CAD/JPY pair is in the process of narrowing its range between the 20-period moving average (MA) on the hourly chart, and on the 4-hour chart, it is positioned between the 75-period and 20-period MAs. Since no RSI divergence is visible, we will be watching closely to see if prices extend higher during U.S. trading hours.
Among European currencies, the Swiss franc rose against the yen after yesterday’s release of the February Consumer Price Index (CPI) showed a 0.1-point increase to 3.4% year-on-year. The CHF/JPY pair rose from 144.714 to 146.036.The pair rebounded, finding support at the 75-period moving average (MA) on the 4-hour chart. The CHF/JPY pair has continued yesterday’s trend during today’s Asian session, rising to 146.196. The 4-hour RSI has risen from 42 and is currently hovering around 65, so it will be worth watching whether this trend continues into the European session.
Today’s schedule includes the Swiss unemployment rate at 15:45 (Asia time), German manufacturing orders and UK Halifax house prices at 16:00 (Europe time), South Africa’s Q4 GDP at 18:30, U.S. wholesale inventories at 24:00 (U.S. time),Fed Chair Powell’s congressional testimony, at 27:00 Swiss National Bank (SNB) Governor Jordan’s remarks and a U.S. 3-year Treasury auction, and at 29:00 U.S. consumer credit data. We will be watching the direction of the CAD/JPY pair, which has limited downside potential.
Author: Keisuke Sakurai
