USDCAD –Daily Chart

USDCAD Daily - April 13 2016

USDCAD has been in a corrective phase and is approaching the end of red wave (A) which has an ideal target at 1.2500. Since this pair has entered a major wave (4) correction, trying to predict a certain pattern it might follow would be improper. We need to analyze what market gives us.

In this daily chart, we see a clear A-B-C (3-3-5) structure that might extend 162% to complete only one cycle (wave (A)) of this bigger wave (4)

USDCAD – 4H Chart

USDCAD 4H - April 13 2016

In this 4h chart, we notice that we are seeing minor wave iii of red wave 5 forming and it needs a new lower low to be completed. If 1.2890 is not breached, we expect a new low and then a bounce back towards same levels.

Note:

  • Trying to pick the bottom here and enter long would be irrelevant and might hurt your p&l.
  • Also, shorting heavily might result in expectation disappointments due to every new low being immediately bought.
  • We are waiting for our lower target to re-evaluate any long swing trades.
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