CADJPY took a nosedive after the YEN yield rates were announced. The market is currently ranging in a supply zone, which means, there is a potential for a continuous impulse bearish leg. We will look for a resistance in this supply zone for the short position as the trend is already bearish with the formation of lower lows and lower highs.

The descending trendline has been reacted with the price action at the supply zone and has formed a bearish wedge pattern.

There is no retracement indication on this particular setup.

EMA 50 is already bearish with a steep downwards curve, therefore verifying the potential downside.

RSI is at 36. It needs to neautralize at the level of 50 in order for the market to align with other technical parameters on the chart.

CADJPY in a supply zone

Dec 22 2022