CADJPY with more to fall as oil looks to head lower

CADJPY with more to fall as oil looks to head lower

CAD/JPY with more to fall?

I came across this Bloomberg piece on the Market's Live Blog this morning making a historical case for further CADJPY downside as follows.

 

The case for further CAD downside

Canada has a strong export oil market, so the fate of the CAD is tied up with the movements in oil. With OPEC discussions breaking down and Saudi Arabia planning to boost its oil production in April to capacity this has led to heavy pressure in the crude market.

USOil

 

CAD/JPY in the 90's

The CADJPY pair going back to the 1990's has been down as low as 58. This was when spot oil was around the $20 point. It is circled in red on the chart below.

CADJPY

So, all of this makes sense for further CADJPY downside. Selling at market, or pullbacks make sense and a target of 71.50 in the near term.

CADJPY

 


Source: FxStreet

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