CIBC Analysts Forecast CAD/JPY Surge to 111.33 Amid Market Reversal
AInvestMonday, Aug 19, 2024 3:00 pm ET
1min read
LIN --
CIBC Capital Markets holds a bullish stance on the Canadian dollar against the Japanese yen, forecasting that the exchange rate will target 111.33. According to analysts Sarah Ying, Maximillian Lin, and Noah Buffam, speculative short positions against the CAD have reached extreme levels. As these positions unwind, it is anticipated that CAD/JPY will benefit from this action.
The analysts explain that much of the negative sentiment surrounding the Canadian dollar has already been factored into its current value. Additionally, the more patient stance of the Bank of Japan and the reduced risk of intervention from Japan's Ministry of Finance are expected to limit the selling pressure on CAD/JPY.
In their Monday report, the analysts officially initiated a long trade on the CAD/JPY pair with a stop-loss set at 103.90. This strategy is based on their assessment that the Canadian dollar is undervalued amidst a backdrop of global economic shifts that favor a stronger performance for the CAD.
The CIBC team's optimism towards the Canadian dollar is informed by a careful analysis of market dynamics and geopolitical developments. They argue that the conditions leading to extreme speculative positions are poised for a reversal, making this an opportune moment for their bullish bet.
Disclaimer: the above is a summary showing certain market information. AInvest is not responsible for any data errors, omissions or other information that may be displayed incorrectly as the data is derived from a third party source. Communications displaying market prices, data and other information available in this post are meant for informational purposes only and are not intended as an offer or solicitation for the purchase or sale of any security. Please do your own research when investing. All investments involve risk and the past performance of a security, or financial product does not guarantee future results or returns. Keep in mind that while diversification may help spread risk, it does not assure a profit, or protect against loss in a down market.