CAD/JPY down 118 pips to 84.92
At the peak of the delta-variant concerns, CAD/JPY was hit hard in a sharp drop to 84.64 from 88.00 over the course of several days.
It quickly recovered as sentiment turned and energy prices rallied but we’re back in the doldrums again. I don’t think this is about the Canadian election today but rather it’s about broad risk sentiment and global growth fears. Oil is also flirting with $70, though that compares with $62 at the delta low.
The intensity of this fall speaks to the fears out there but it’s looking a bit overdone in the short term. That said I certainly wouldn’t be buying it here. There is a clear series of lower highs since June and we could see another day like today if 84.64 breaks.