More CADJPY Losses

by Ashraf Laidi
Apr 20, 2009 11:25 | 7 Comments

More CADJPY Losses - CADJPY Apr 20 (Chart 1)

Recent losses in CAD are likely to intensify against the Japanese currency as global risk appetite is expected to come under broad pressure after a positive 2 weeks. Tuesdays interest rate decision by the Bank of Canada (9.00 EST, 13:00 GMT) is expected to leave rates unchanged at 0.50% according to consensus, but the cenbank could well lay out the groundwork for credit easing, in the event that it is forced to cut rates to 0.25%. Although all JPY crosses have dropped over the past 2-3 days, CADJPY downside is underlined by CAD-specific factors as well as systemic-related factors (US earnings, stress test confusion/concerns etcc). Interim target stands at 79.70, while weekly chart shows losses to extend towards 78.40. Last weeks high of 82.75, consisted of a breach of the key 83.25 resistance 38% retracement of the decline from the Jul high to the Jan low.


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Comments (Showing latest 7 of 7) View All Comments
Ashraf Laidi
London, UK
Posts: 0
14 years ago
Apr 21, 2009 7:47
Sam, as risk appetite fell (stocks dropped), CHF, JPY and USD went up. I explained this fully in Chapter of 5 "Risk Appetite in the Markets" of my book. I do NOT expect EURCHF to drop below 1.5 as the Swiss National Bank is likely to intervene again by selling CHF. 50-day MA at 1.5050.

JZ, Watch out for the BoC decision today and the policy report from the BoC on Thursday. I think we'll still go above 1.25 and 1.27 in the next few weeks as stocks fall further. Further declines in oil do help weigh on CAD BUT they're not obligatory for CAD to drop. Stocks have MORE INFLUENCE on CAD than oil.

P.S. CADJPY hit a session low of 78.69, right at the 78.70 target in this HotChart.

Vancouver, Canada
Posts: 4
14 years ago
Apr 21, 2009 4:33 you think oil heading toward $45&USD/CAN at.1.2700 in the near term? Your opionion's greatly appreciated.Thank you.
auckland, New Zealand
Posts: 2
14 years ago
Apr 20, 2009 21:48
Hi Ashraf
Why did Eur/CHF go down to 1.51 instead of 1.53, will it still go up, or down...thanks
Ashraf Laidi
London, UK
Posts: 0
14 years ago
Apr 20, 2009 19:09
Vankata, thanks, will do.

Cappy, it's down over 120 pips so far.

Houram, let's take it bit by bit (instead of the whole 4 weeks). dont think risk appetite will drop without interuption for next 4 weeks. medium term target stands at 51 before month end. I dont see any rapid declines in stocks until late May to June.

Vancouver, Canada
Posts: 55
14 years ago
Apr 20, 2009 18:08
Hi Ashraf,
Assuming that we will see risk appetite coming under pressure for the next 4 weeks, where would you see NZD/JPY, below 48?
United States
Posts: 19
14 years ago
Apr 20, 2009 17:51
Yes, I'm in favored of that too!!

Plovdiv, Bulgaria
Posts: 3
14 years ago
Apr 20, 2009 17:44
When you set up the new course on the intermarket analysis, can you make it online, i really would like to participate in it. I live in Chicago at the moment.