(MENAFN- Daily Forex)

• The Canadian dollar initially tried to rally against the yen, but then fell rather hard as we continue to see a lot of volatility.
• That's not a huge surprise as this is a market that is going to have a lot of crosswinds, not the least of which is going to be the fact that Friday features the Canadian jobs report. So do keep that in mind.

That being said, the Japanese yen strengthening could be due to a little bit of risk off, or it could just simply be due to the fact that the market had rallied so significantly against the yen over the last week or so. And when I say the market, I am referring to the currency markets in general. It's not just the Canadian dollar that's been positive.

Top Forex Brokers1 Get Started 74% of retail CFD accounts lose money The 200 Day EMA

It's probably worth noting that we pulled back from the 200 day EMA, but if we can break higher from here, then I think we challenge that indicator again. Remember, the 200 day EMA is typically watched by technical traders rather closely for an eye on what happens with the trend. Above there, we have the 110 yen level, which of course is a large round psychologically significant figure, and also an area that sees a little bit of market memory. If we can get above that level, then 112 yen is your target. On a pullback below the 50-day EMA, perhaps somewhere around 107.50 yen, you could see buyers come in. Anything below there opens up a door back down to the 105 yen level, which would obviously be very negative as market participants continue to try to gauge what the risk appetite around the world is.

Furthermore, keep in mind this is almost a pure play on crude oil because Canada is an oil exporter and Japan imports 100% of its crude oil, so this might move with the oil markets as well.

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