Listen to the market mood for the CADJPY currency pair in the coming session:
We are expecting the JPY to be weaker today on continued improved risk sentiment following hopes that the coronavirus will be contained and the news that China will cut tariffs by as much as 50% on $75bn of US goods effective as of Feb 14.
We are expecting CAD strength today as the latest recovery in oil prices is supportive of the CAD. Also, as a commodity and a risk-on currency, it tends to rise on risk-on moves as we are seeing today.
Expect CADJPY buyers on pullbacks.
Risks to this outlook
If we see a fall in equities on coronavirus fears or a fall in US Crude prices then CADJPY will find sellers and invalidate this outlook, so keep a close eye on risk sentiment which still remains vulnerable to large swings at the moment.