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CADJPY finding some legs H1 and Daily

Market Analysis

CADJPY, H1 & Daily                    

USOIL has held $47.50 this morning following yesterday’s fall to $47.15.  Tropical storm Harvey, expected to be a hurricane when it hits the Texas coast on Friday has been the driver, with upwards of 30 refineries potentially in the path of the storm. While Gulf production is not expected to be impacted much, the shutting of refineries would put a serious dent in oil demand. Gulf coast refineries make up roughly 1/3 of U.S. crude demand.  Conversely though the CAD continues to hold up and I have two long positions on CADJPY. The Daily position trigger on last nights close and a key candle pattern offered a H1 trade too this morning.

The H1 time frame has trended sideways overnight but he 10 o’clock candle was the trigger for a short term long position from 87.64 with a target at the 14 ATR and recent fractal high at 87.75. The stop loss sits below the fractal low and psychological 87.50 at 87.49.

The higher daily timeframe also looks positive. Lasts nights close showed a clear breach and break of the key 20 DMA, it also approached the 50.0 Fibonacci retracement level from the last move down to 85.40. The higher weekly and monthly time frames are mixed so a target close to the 14 ATR and next Fibonacci level – the key 61.8 level – was taken at 88.25, from the entry at 87.55. The break of the 61.8 Fibonacci level could extend the run to target 2 at the psychological 89.00 and next cluster of fractal highs.  A break of the recent fractal low at 86.05 will negate this move to the upside.

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Stuart Cowell

Senior Market Analyst

HotForex

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