USDCAD - Relief For The CAD Will Be Short Lived
Updated
I do live in Canada and I will try not to get into the politics and economy, but the future for the CAD is not bright. Taking on a huge amount of debt, taxes and difficulties raising rates when times are good. Mostly, just a quick comparison to the United States and Canada is not even close.
Anyway, the USDCAD just broke out of a longer-term downtrend on both the weekly and daily. It put in a reversal signal indicating a retrace back to the breakout level. After taking a short trade there at 1.33515 and exiting at the close on the 29th, I am looking for a signal to go long.
I will be looking for a signal on the daily to enter around the breakout level, which also acts as a supply zone. Once an opportunity to go long presents itself, I will look for a grouping of factors that support the trade. At the breakout level around 1.30864 we will have:
- An area of supply
- Market swing point (trend line)
- A test of the 28 day ema... all moving averages would still be bullish (this may change)
- In line with an event area, the breakout, but also on the 19th of March
- Trade is in direction of the current trend on the daily and weekly
I do use the RSI and Full STC and at the moment they are not in extreme zones because we are simply looking for a retrace. However, before I take the trade I will be looking for a curl up or higher low on each.
In the meantime keep a pair like this on your watchlist, because it may have the potential of a 3 to 1 R/R. Maybe even greater if it rips through its most recent high.
Anyway, the USDCAD just broke out of a longer-term downtrend on both the weekly and daily. It put in a reversal signal indicating a retrace back to the breakout level. After taking a short trade there at 1.33515 and exiting at the close on the 29th, I am looking for a signal to go long.
I will be looking for a signal on the daily to enter around the breakout level, which also acts as a supply zone. Once an opportunity to go long presents itself, I will look for a grouping of factors that support the trade. At the breakout level around 1.30864 we will have:
- An area of supply
- Market swing point (trend line)
- A test of the 28 day ema... all moving averages would still be bullish (this may change)
- In line with an event area, the breakout, but also on the 19th of March
- Trade is in direction of the current trend on the daily and weekly
I do use the RSI and Full STC and at the moment they are not in extreme zones because we are simply looking for a retrace. However, before I take the trade I will be looking for a curl up or higher low on each.
In the meantime keep a pair like this on your watchlist, because it may have the potential of a 3 to 1 R/R. Maybe even greater if it rips through its most recent high.
Note
USDCAD has reached my buy zone, waiting on a buy signal to open a long position.
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