On the CADJPY pair, the focus this week is a consolidation in form of a weekly descending channel. The tag of war between bulls and bears within the channel is evident as prices have been contained within the support and resistance boundaries. However the main players are the bears who have taken prices lower and lower for the past 2 years.. The past week closed off with a pin bar.
Pin bars are potential reversal signals. In order to come up with a bearish bias, we need to see the pin bar confirmed by a candlestick that closes below such as an engulfing or a bearish marubozu. Until then, we patiently observe the charts for further price action.
On the GBPNZD pair, the daily timeframe shows an ongoing fairly strong uptrend trading within an ascending channel. Bulls are the dominant market participants signified by the trend which is up. Prices have been resisted at the upper boundary as well as being supported at the lower boundary. Most recently a doji formed followed by a bullish marubozu.
Price action suggests that bulls are determined to push prices much higher. Nevertheless, we have to monitor and see how price will behave upon reaching the channel’s resistance. Otherwise the rally may be headed towards the major resistance.