CAD/JPY Daily: Double Bottom Setup

12 February 2016 1:05 p.m. ET
 
This is a pure bottom picking trade with three potential big kickers: 1) Bank of Japanintervention; double-bottom hammer pattern bounce in oil; and 3) a double bottom hammer pattern in the S&P 500 index at key swing support 1820. 

There is  a tight correlation between the path of oil prices and CAD/JPY as you can see in the chart below.  We have a double-bottom in oil today, and a double-bottom in the currency pair.  In addition, there has been a lot of chatter about the Bank of Japan intervening, to sell yen, because of its huge rally against all comers over the past week.  Not sure any intervention would be long-lived, but would likely lead to a pop in this pair if we see it.  

Crude Oil Weekly: Hammer bar and double-bottom setup...

S&P 500 Index: Double-bottom? Double-hammer candlestick pattern into the lows....just below 1820 swing support...

If this clicks into place for us, CAD/JPY long should be a nice trade.  

Black Swan Capital

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