CADJPY continues to trend lower on its 4-hour chart, with price trading below a falling trend line that’s been holding since the start of November. Price looks ready for another test of this resistance level soon.

Using the Fib retracement tool on the latest swing high and low shows that the 61.8% level is close to the trend line around the 90.00 major psychological mark. This also lines up with the 100 SMA dynamic inflection point.

On the subject of moving averages, the 100 SMA is below the 200 SMA to indicate that the path of least resistance is to the downside or that the downtrend is more likely to resume than to reverse. The 200 SMA is also near the trend line around 91.00 per barrel and might add to its strength as resistance.

The pair seems to be finding some resistance at the 38.2% level, but RSI still has some room to climb. This suggests that buyers still have some energy to push for a test of the higher resistance levels until overbought conditions are met.

Stochastic is already in the overbought zone to reflect exhaustion among buyers, so turning lower would confirm that sellers are ready to take over.

The Canadian Ivey PMI is up for release today, and analysts are eyeing a climb from 59.3 to 60.2, reflecting a stronger pace of expansion. However, traders might hold out for the BOC decision tomorrow.

The BOC is widely expected to keep interest rates on hold at 0.25% while signaling caution ahead. Like most major central banks, they are likely worried about the impact of the Omicron variant to global growth and price pressures.

There are no major reports due from the Japanese economy, so the yen could simply take cues from overall market sentiment. Risk aversion has been favoring the safe-haven currencies like the yen these days.