CAD/JPY Value Surge Amidst Central Bank Contrasts

During a prepared speech at the Toronto Region Board of Trade, Tiff Macklem, the Governor of the Bank of Canada, emphasized the central bank's unwavering commitment to restore price stability and signaled a willingness to further increase interest rates if inflation persists significantly above the 2% target. In stark contrast, Federal Reserve (Fed) Chair Jerome Powell suggested earlier this week that the central bank was nearing the terminal rate of the current tightening cycle. As a result, the CAD/JPY has exhibited an increase in value over the past week, concluding with a bullish surge at a value of 100.77, characterized by an AB=CD pattern where the first D point is anticipated to emerge at levels between 102.500 and 103.000, before a potential reversal or retracement. Our underlying perspective is firmly based on the expectation of a long continuation towards the next resistance area illustrated on the chart.