CAD/JPY declined more than 100 pips from the temporary top of 117.19 on broad-based Canadian dollar weakness. Now trading around 116.17, it reached an intraday low of 116.09.
Canada's February jobs report disappointed, with employment dropping 84,000 (-0.4%, vs +10k expected), marking a second straight decline in the employment rate to 60.6%. Unemployment rose to 6.7% (+0.2pp vs 6.6% forecast) amid more job seekers; youth lost 47k jobs (rate 14.1%), core men 41k (rate 5.7%), hitting wholesale/retail (-18k), services (-14k), construction/manufacturing, Quebec (-57k), and BC (-20k) hardest. Hourly wages grew +3.9% YoY ($37.56), but softening labor amid Hormuz trade risks lifts BoC April rate cut odds to ~70%, pressuring CAD lower.
Technical Analysis
CAD/JPY is currently trading above the 34- and 55-EMA, 200 EMA, and 365 EMA on the 4-hour chart. The immediate resistance is at 116.50; a breach above that level could shift targets to 117.20/118. On the lower side, near-term support is at 115.80, and a break below this support could lead to declines toward 115.40/114.70/114.
Indicator Trends
CCI (50)- Bullish
ADX (14)- Neutral
Trading Strategy Recommendation
It is good to buy on dips around 115.78-80 with a stop-loss at 115 for a target price of 117.25/118.
