I booked my profit on my CAD/JPY long last night mere pips away from the top. It was a lucky move, that's all. Now it looks as though CAD/JPY will do one of the following:
- Break down from here. A break below 86.50 will confirm an intermediate term downtrend. However, I don't expect CAD/JPY to spin on a dime right after testing an obvious resistance. So I think #2 is more likely.
- False breakdown to above 86.50, retrace to 88.00, and hang around this range for a few more days then initiate an intermediate term price fall (#1).
- Although unlikely, case #3 is still possible. CAD/JPY can remain suppressed at this 87 price level and creep upward deviously to test 89.30.
The difference between #1 and #2 could be subtle. But I couldn't bank on either one yet because the reward/risk isn't favourable at this moment. So I'm going to stay on the sideline and wait for a better price or for the signs to be clearer. On another note, I'm still keeping an eye on gold and Aussie. There should be a big one soon.
[caption id="" align="aligncenter" width="570" caption="CAD/JPY, daily"][/caption]