CAD/JPY Reflects A More Positive Market Sentiment
Anna Coulling | Jan 09, 2019 07:34
The news seems to take a back seat these days to the Trump twitter feeds, his spats with the Fed, tariff wars and Brexit. The next few days are no exception with the only significant item of fundamental news being the rate decision from the BOC which is followed later in the day by the release of the FOMC minutes which will make particularly interesting reading given Powell’s change of tone since the Fed’s December meeting. Powell pops up again tomorrow when he is due to speak at an event in Washington and he is also expected to answer questions from his audience.
Between these two events, newswires are reporting that the US and China are planning a joint release on the result of trade talks that have been going for the past three days, one day more than originally been planned. This additional day has been interpreted favourably by the markets and a reason for a positive outcome helped along by a tweet from Donald saying the talks were ‘going very well’. Additional comments from a member of the US delegation that the talks had ‘been a good one for us’.
Markets have reacted positively to this cautious optimism with the Shanghai CSI, Japan’s Topix and the Hang Seng all rising strongly. Oil too has benefited as risk appetite appears to have returned – at least for the time being.
The CAD/JPY pair reflects this perfectly and continued higher in the Asian session with the price now at our R3 resistance on the 8 hr chart at 82.38 where it is currently pausing. This level is also significant on the faster time frames where it is the R4 resistance on the Camarilla indicator and is a level the pair must break and hold if the recent bullish momentum is to continue.
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