CAD/JPY is finishing a corrective rally
|CADJPY has been in strong rise this year, but we see five waves up from 2023 swing lows, that are now completed because of a strong drop through the trendline support. We see an impulse down for wave (A)/(1) that is completed, so more weakness can show up for wave (C) or (3) after a current corrective rally in wave (B)/(2) that can be still underway, but it can be approaching the end, as it’s nearing strong 110 – 112 resistance zone.
CAD/JPY daily chart
Basic Elliott Wave Pattern shows that after every five-wave impulse, we should be aware of a slow down in minimum three waves ABC or 123. So, when you recognize a change in the trend in a sharp or impulsive fashion for wave A/1, you have to expect more weakness for wave C/3 after a corrective retracement in wave B/2.
Basic Elliott Wave pattern
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