CAD/JPY

Markets are in a jittery mood. President Trump has been prolific on twitter overnight. Look at Eamonn's Asian news wrap to see the range of his tweets. Up to this point the market has been very good at putting aside the latest 'trade spat' tweet, but overnight in Asia there was a sell off in equities and a slide in US treasuries at the end of the US session yesterday. USD/JPY fell from 110 as JPY strengthened across the board. JPY gained last night in the Asian session. These were not huge gains, but the market is in a cautious mood.

I lke the idea of a CAD/JPY short if there is a miss on the employment change and the unemployment rate for CAD later today at 1330BST. If the market remains cautious into the G7 over the weekend and there is a miss on CAD numbers CAD/JPY has plenty of downside. On the daily chart price has rejected from both the 100 and 200 MA. Price is currently trying to move down through the 10MA (green line)

So, one to watch for later.

Risks to this trade: Risk sentiment shifts during the session and before the Canadian data release. A positive data release for CAD would ruin this set-up too. Keep an eye on Trump's twitter feed, he is firing them off left right and centre at the moment. He could do with leaving his phone at home this weekend.