The CAD/JPY currency pair is an exotic asset for long-term trading.
The CAD/JPY currency pair is in the category of those assets that traders really like and can bring a good profit margin. However, it is important to correctly apply fundamental analysis.
The asset is characterized by poor predictability, if you focus only on technical analysis.
Pair volatility and trading volumes
For example, during the day, the exchange rate jumps can reach 150-250 points per trading day, and this is quite normal for a pair, since there is a strong reaction to economic indicators, foreign policy activities of countries and the publication of news from strategic partners.
The Canadian dollar-yen is an exotic currency pair, and high trading fees immediately weed out those traders who prefer to use scalping and short positions.
The average spread for a currency pair reaches 7-15 pips, however, with the FinmaxFX broker you will find the best trading conditions and you can always trade with profit.
Deciphering the elements of the CAD/JPY currency pair
The Japanese yen is the national currency of the Land of the Rising Sun, especially popular in the Asian region. The state acts as the largest exporter of computer and home appliances, while producing high-quality small and hybrid cars.
The yen is always sensitive to news that is related to the automotive industry or the increase in the cost of components. If we consider the fundamental factors, then the currency is influenced by the following:
- the press conference of the Japanese Central Bank is the strongest news factor moving the yen chart;
- data on industrial production volumes;
• GDP indicator.
Also, the position of the yen is influenced by the dynamics of the US dollar, as the countries maintain close economic ties.
The Canadian dollar is the national currency of Canada, and the country, in turn, is on the list of the largest oil exporters. The main partner in the sale of oil is the United States, so there is a strong dependence on world prices for black gold.
If the price of raw materials rises, the positions of the Canadian dollar will strengthen, and if they fall, the exchange rate will weaken.
The key factors influencing the currency of Canada are the following:
- GDP is a key indicator of influence;
- consumer price index;
- the level of employment of the population and the dynamics of unemployment.
Features of the course behavior on the chart
CAD/JPY is a cross rate, in which the Canadian dollar is the base element. The pair indicates how many Canadian dollars can be bought in terms of yen.
The greatest trading activity is typical for the Asian and American trading sessions, which corresponds to the regional location of the states. If you plan to open long-term deals, then you can consider the option of concluding them in the first half of the European session, then you can not be distracted by short-term dynamics.
There is a strong correlation with the oil price chart and sometimes a connection with Brent futures, which helps to set targets for the medium and long trading periods. In addition, the quotes of the euro-yen pair also affect.
Forex trading takes place almost around the clock, and a high spread does not allow the use of a scalping strategy. However, it is possible to trade on a breakdown when entering at the beginning of the American session or its intersection with the European one.
Trading recommendations for working with the CAD/JPY asset
For traders who want to use this asset for their transactions, it is important to consider the following features:
- a high Wednesday indicator, which is typical of many cross-rates due to double conversion;
- It is not recommended to use scalping and short-term strategies.
This pair has the right to be called technically complex, but this does not go to the detriment of its trading attractiveness and the possibility of long-term investment for experienced traders. It is not suitable for beginners and you cannot get a quick profit from it.
If you want to learn how to trade competently, register on FinmaxFXwhere you will get the best trading conditions and the opportunity to develop your trading skills.
A live chart for the CADJPY currency pair is an ideal solution for those who do not want to install MT4 for analysis.