USDJPY Stays Bullish; USDCAD Holding Onto the Upside Bias

USDCAD Chart 2018-07-25

  • The US$ has shifted to a more erratic tone into latter July from a more positive tone earlier in the month, being buffeted by global trade war concerns, rising yields, jawboning from Trump and a broader “risk on” move to US (and global) equity markets.
  • When we last looked at USDJPY here on 16th July, we highlighted the ongoing intermediate-term bull trend, which remains very much intact during the current correction phase, whilst holding above 110.28/25.
  • With respect to the USDCAD currency rate, the market did produce a solid rebound after the early July corrective setback, but latter July setback has again eased the intermediate-term bullish trend, but we only see a more negative shift below 1.3063/61.


Immediate rebound bias intact above 110.74/68

A Tuesday rebound stall back from 111.54 resistance, but whilst holding above the 110.74/68 support area from mid-July and this week, we still see the risks back to the topside for Wednesday.

The early July push above 111.08 shifted the intermediate-term view to bullish.

For Today:

  • We see a rebound bias higher for 111.54 and 111.85/90; break here aims for 112.55/60.
  • But below 110.74/68 opens risk down to key 110.28/25.

Intermediate-term Outlook – Upside Risks: We see an upside risk for 113.39/55.

  • Higher targets would be 114.73, 115.50/63 and maybe towards 118.65.
  • What Changes This? Below 110.25 shifts the outlook back to neutral; only through 109.35 signals for a bear theme.

Resistance and Support:

111.54 111.85/90 112.55/60 113.14/18* 113.39**
110.74/68** 110.28/25*** 109.95* 109.65* 109.35***

4 Hour Chart

USDJPY Chart 2018-07-25


Positive theme still trying to resume

A dip Tuesday after Monday’s rebound effort from above 1.3105 support (from 1.3118), but we still see a positive tone, attempting to resume recent bull forces from early July, keeping the bias back higher Wednesday.

The early May break above 1.2944 sets an intermediate-term bull trend, BUT we see growing risk for an intermediate-term shift to neutral below 1.2945.

For Today:

  • Whilst above 1.3110/05 we see an upside bias for 1.3230/33; break here aims for 1.3290 and then 1.3302.
  • But below 1.3110/05 opens risk down to 1.3063/61, maybe 1.3025.

 Intermediate-term Outlook – Upside Risks: We see an upside risk for 1.3347.

  • Higher targets would be 1.3500, 1.3550 and 1.3794.
  • What Changes This? Below 1.3061 shifts the outlook bullish straight to a bear trend.

Resistance and Support:

1.3230/33 1.3290/3302 1.3351* 1.3382/86** 1.3437
1.3110/05* 1.3063/61*** 1.3025 1.3000 1.2945

4 Hour Chart

USDCAD Chart 2018-07-25

Risk Statement: Trading Foreign Exchange on margin carries a high level of risk and may not be suitable for all investors. The possibility exists that you could lose more than your initial deposit. The high degree of leverage can work against you as well as for you.