CADJPY was capped by the red Tenkan-sen line today after the strong pullback from the two-and-a-half month high of 85.25 on Friday. Also, the pair dropped back below the 61.8% Fibonacci retracement level of the downleg from 89.25 to 76.60, around 84.40. The RSI and the MACD are moving sideways in the positive zone, suggesting a possible downside retracement.
Further losses could find immediate support at the 83.96 barrier, before moving towards the 20-day simple moving average (SMA) currently at 83.62. Steeper declines could send the market until the 50.0% Fibonacci of 82.90, which stands near the 40-day SMA and then could move even lower touching the 82.26 hurdle, breaking the ascending channel.
In the event of positive pressures, the market could meet resistance at the 85.25 region, while more gains would endorse the bullish bias, surpassing the upper band of the channel. The next level is coming from the 86.25 obstacle and then from the 87.00 psychological level.
To sum up, CADJPY holds a slightly bullish profile in the short-term, following the pullback on the two-year low of 76.60.
