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CAD/JPY Cracking Neckline

We recently discussed how CAD/JPY was about to complete an inverted head and shoulders pattern. This price bottom scenario is materializing, and price is even cracking the neckline this week.

CAD/JPY Daily Chart

(click to enlarge)

Price Bottom:
- The daily chart shows price cracking the neckline.
- In fact the 7/12 session candle is a bullish engulfing candle. 
- This candle reflects a failed attempt by the market to fade CAD/JPY at this key resistance.
- The fact that it closed the session higher suggests the momentum would carry CAD/JPY above the neckline.

- While 90.00 might be a near-term target and psychological resistance, I think there is upside at least to the 92.25-50 area, which involves some key support/resistance pivots going back to 2013. 
Key Support:
- In the short-term, if price falls back down and breaks the 7/12 session low (87.40), then we might need to scrap the bullish outlook and anticipate downside risk towards 84.00 before looking for more clues.