CAD/JPY 1H Chart: Channel Down

Starting from Feb 19, when the 200-hour SMA failed to keep the currency pair afloat, the Canadian Dollar has been gradually ceding ground. And while in the near-term, as implied by the hourly technical indicators, the exchange rate may somewhat recover, CAD/JPY is highly unlikely to ascend beyond the resistance at 92.30. This supply area is mainly created by the down-trend resistance line, but is also reinforced by the daily R2 level. Accordingly, we expect the loonie to change its direction in the nearest future and start moving towards 91.13—a probable point of contact with the lower boundary of the bearish pattern.