Hello and welcome to CantosCharts. My name is James Hughes from spread betting firm CMC Markets.

Today we're going to look at currencies and in particular we're going to look at the JPY against the CAD firstly and then against the EUR.

Now against the CAD we've seen a lot of fundamentals moving these markets. Not just this market, but a lot of other asset classes as well. We've seen of course the stress tests that were released on Friday. We've also seen the re-emergence of the sovereign debt situation, earnings news as well as weaker US data. All of these things have been moving currencies, have been moving the JPY because we've had that risk on/risk off trade happening quite a lot.

Now looking into this chart and what we've seen, over the last, from really the start of the month we've seen the market move pretty steadily higher. We saw some aggressive up days. Every candle in here is a day, so this is a daily chart. We've seen the markets move higher, plateau out at the top. Once we got to that top level which was around 86.40, which is also acting as a bit of a resistance level on the upside - we saw it test earlier on as well, once we got this point we plummeted lower again. We can see that range from where we got to on the lowest point as well around this 81.70 level which happened to be the lows from earlier in the month, maybe even late June. So again we can see that range that this market is staying in.

But once we plummeted down, we got what we expected - a slow gradual move higher, started to tick up to these extra levels. But what we've got on here is a Fibonacci retracement level. From the top here we moved to the low point and we actually started to rise to that key level, that 61.8 per cent retracement level. That 61.8 is the key number in Fibonacci and Fibonacci trading. 84.60 is the level. 61.8 per cent, we touched right on that level, then started to fall down pretty aggressively and even since putting this chart up we're even a little bit lower than where we are at the moment.

So it's real key moves on this. This 61.8 per cent level is going to be the big one to look out for over the next few days.

Now the next chart is the EUR/JPY. We've seen again some interesting moves in this. This has been a pretty spectacular fall down. It's been pretty impressive. We've seen the peaks and the troughs of this. We've still got the trend line resistance level on the upside. Now okay, we're obviously a little bit a long way away from that at the moment down on this lower side but we started up at the peaks here sort of October time, almost going into November. We then started to see the market come down. We've had some brief moves above it, but it doesn't seem like we've seen anything too aggressive, so we can pretty much disregard these little jumps above over here because the market fell off so aggressively after that and that a key point when we're looking at these trend line support/trend line resistance.

If we do get the odd break and we have to think that we are going to get those breaks every now and again, we're not going to always see an absolutely perfect example of technical analysis. It's very hard to find those out. So when we're seeing this, we did see the little break above, but that was followed by an aggressive fall back lower. So that really keeps this trend line support/trend line resistance level intact. Again, the market moved back up, didn't even test this time, came down a couple of times, but it is these continuous lower levels that we keep getting. The lower highs are the key points to this downtrend that we've got at the moment and this looks pretty steadfast in there at the moment.

Now we're talking about the next time we're going to see this test. The market has fallen pretty heavily, but at the moment we are really being kept by this resistance level on the upside at around 112.50/112.65 or so. Now this has been keeping us out there from the start of June and we have seen an enormous amount of tests to this resistance level on the upside. We've got almost seven, eight, nine tests of this level.

Now, of course, when you're looking at how important a resistance or support level is going to be, a great way to gauge how big and how important that level is going to be is by how many times that level is tested. This has been tested a number of times and it is really keeping us from going up to test this, so it makes us look at this pair and think okay, EUR/JPY at the moment really being held down here. Again, we've got that range trading that we spoke about with the CAD against the JPY as well. We're in between this range at the moment. It looks like we could stay there for a little while because of the way the markets because of the way the markets are performing at the moment. A break above this level would be pretty significant. But if we do see the break, okay, it's a long way up but we've got this trend line resistance level on the upside which is really going to cap anything as well.

So despite that negativity there and that weakness, we are starting to see the negativity plateau off a little bit. It's starting to go sideways and if we do get that sideways, it can often be a sign that the market is going to start to change and that key sign that the market is going to shift will be if we break this level around 112.50/112.65 or so. So that's going to be the key one to look out for. If we break that, then it could be up to the 120s that we're looking to go.

So it's going to be an interesting time over the next few weeks and months or so to see if we can break out of these levels, but especially with the CAD one, that's a little bit short-term, looking to see if that market is going to come off of that 61.80 level again, but still looking at this move here.

Thank you for listening. My name is James Hughes from CMC Markets. Join us tomorrow when we'll be looking at a little bit more of commodities and precious metals and we will look at the gold price.