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This pair recently busted through its longer-term range resistance, and it looks like a pullback is in the works.

Will support hold at the area of interest?

Before moving on, ICYMI, yesterday’s watchlist checked out AUD/USD for a potential risk-off setup. Be sure to check out if it’s still a valid play!

And now for the headlines that rocked the markets in the last trading sessions:

Fresh Market Headlines & Economic Data:

Crude oil tumbles below $100/barrel ahead of FOMC this week

RBA meeting minutes: Russia’s war on Ukraine is a new source of uncertainty

RBA: Australian economy is resilient, sees a central case to stay patient

Chinese retail sales surged 6.7% vs. 3.0% forecast, 1.7% previous

Chinese fixed asset investment up 12.2% vs. 5.0% forecast, 4.9% previous

Chinese industrial production rose 7.5% vs. 4.0% forecast, 4.3% previous

PBOC injected 100 million CNY into financial markets, kept rates on hold

Ukraine negotiations with Russia to continue today

Reports of huge explosions in central Kyiv and a Russian drone entering Polish airspace

Upcoming Potential Catalysts on the Forex Economic Calendar:

Eurozone & German ZEW economic sentiment figures at 10:00 am GMT
U.S. headline and core PPI at 12:30 pm GMT
U.S. Empire State manufacturing index at 12:30 pm GMT
ECB head Lagarde’s testimony at 3:15 pm GMT
New Zealand GDT auction coming up

Use our new Currency Heat Map to quickly see a visual overview of the forex market’s price action! 🔥 🗺️

What to Watch: CAD/JPY

CAD/JPY 1-hour Forex Chart

CAD/JPY 1-hour Forex Chart

There’s not much in the way of top-tier news events to trade today, so I’m looking at this technical setup on CAD/JPY for now.

You see, the pair busted through the resistance we were eyeing last week, suggesting that an uptrend may be in order. Before that happens, though, CAD/JPY might still retreat to the area of interest on its hourly chart.

The Fib retracement levels span an area of interest that’s right around a rising trend line and previous high. A shallow pullback could already find buyers at the 38.2% Fib while a larger correction could reach the 61.8% Fib near the 100 SMA dynamic support.

This moving average is above the 200 SMA to confirm that support is more likely to hold than to break. In that case, CAD/JPY could soon find its way back up to the swing high and beyond!

Stochastic is pulling higher after reaching the oversold region, too. This means that buyers are taking over while exhausted sellers take a break.

I’d still be on the lookout for headlines that could influence overall market sentiment, but so far it looks like risk-on flows are surging due to upbeat Chinese data. Any signs of progress in Russia-Ukraine talks might also boost riskier holdings.