FxWirePro- CADJPY Trade Idea

FxWirePro- CADJPY Trade Idea

CAD/JPY declined slightly after BOC rate cut. It hits an intraday high of 103.62 and is currently trading around 103.15.

On March 12, 2025, the Bank of Canada lowered its benchmark interest rate by 25 basis points to 2.75% because of continued tensions in trade with the U.S., the seventh straight rate cut. The action is designed to help the Canadian economy, which is forecast to slow at the start of next year even as GDP growth picks up for late 2024, following tariffs affecting company and consumer confidence. While inflation is still close to the BOC 2% target, there is still worry about increasing inflationary pressures from the tariffs, and the BOC will move cautiously with future rate hikes, knowing monetary policy cannot completely offset an extended trade war.

Technical Analysis

CAD/JPY is currently trading above the 34- and 55-EMA on the 4-hour chart. The immediate resistance is at 103.70; a breach above this level could shift targets to 104.50/105/106/107.40/108/108.35/109.30/110. On the lower side, near-term support is at 102.30 and a break below this support could lead to declines toward 102/101.50.

Indicator Trends

 CCI (50)- Bullish

ADX (14)- Neutral

Trading Strategy Recommendation

It is good to sell on rallies around  104.18-20 with a stop-loss set around 105 and a target price of 101.60.