Hi Traders! CADJPY short term forecast and technical analysis is here. We do our analysis on the MetaTrader4 platform (MT4). Some very interesting, useful tips and hacks about the MT4 platform could be found here. If you would like to learn more about the way we trade and the technical analysis we use then check out the Traders Academy Club Spoiler alert – free memberships are available! Let’s start our analysis from the highest timeframe which will be the daily chart here.
CADJPY D1(Daily) Chart Analysis – Bullish Trend, Bullish Hidden Divergence, Range
On the daily chart, we have a bullish trend and the price which was moving higher created higher highs between the first high that has formed at 88.456 and the second high that has formed at 93.020 based on the MACD indicator, we may consider this as evidence of bullish pressure. We then had a correction with the price creating a bullish hidden divergence that has formed between the first low that has formed at 84.666 and the second low that has formed at 87.703 based on the MACD indicator which we may consider as evidence of bullish pressure. The price then moved higher and has created the first leg to the upside, currently it looks like a correction is happening in the form of a range and there are no signs of trend change, so basically I expect this bullish trend to continue further. We may now move down to lower timeframe and look for evidences supporting this short term bullish view.
CADJPY H4(4 Hours) Chart Analysis – Bullish Convergence, Key Support Zone
Looking at the H4 chart, we could see that the price which is moving lower has reached a key support zone formed by the 100% (89.101) Fibonacci expansion level of the first wave and the bottom of the range. The price respected this zone and is currently bouncing higher from this zone. Also, the price which was moving lower created a bullish divergence that has formed between the first low that has formed at 89.934 and the second low that has formed at 89.380 based on the MACD indicator. Then the price moved higher and broke above the last high at 90.757 creating higher highs, thus forming a classical setup of bullish divergence followed by bullish convergence. Hence as per the book scenario, after a bullish convergence, we may look for corrections to happen and then further continuation to the upside. Currently it looks like a correction is happening. Until the key support zone (marked in blue) shown in the image below holds my short term view remains bullish here and I expect the price to move higher further.
Technical Analysis & Forecast Summary
CADJPY D1(Daily) Chart Analysis
- Bullish Trend, Bullish Hidden Divergence, Range
CADJPY H4(4 Hours) Chart Analysis
- Bullish Convergence, Key Support Zone
Trading Tips
It is always recommended to look for confirmations before you jump into any trade. If you are not sure about how to trade this short term buy setup then you can use any setup and strategy that you have in your arsenal to look for bullish moves and join this buy trade.
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Arvinth Akash
Traders Academy Club Team
