USDCAD - Never Fade THE Signal

After so many attempts to break to the land of Valhalla. Carrying a beautiful candle in bullish formation only to turn into a bomb and kill all the bulls and bring despair on the landscape. We were warning to get out of the longs, already in good profit, and start taking the opposite trade. It was clear enough with the negative reaction it had at 1.38976 to expect a move to the downside.

Since we are approaching the current short target (review previous post) let's redefine targets and possible pivot points for what this chart has in store for us.

Let's look at the daily:

It had a clear break below the EQHs and as a result a daily close inside the range it had attempted to exit, which was enough to trigger the follow through move.

Approaching Mid Level

This week will remain bearish as it has 4 bearish days left of the current move. I expect it to touch 1.35623 (it is quite close) before having a bounce.
The trend is back to being bearish, so for now don't look for longs in that sector. My intention is to wait for a break below the 1.35623 mid level and go short again.

The other option is to wait for a price deviation below that level and go long but I have that as a plan b.

Price Deviation Scenario

Actions to take:

Since it is in a pivotal zone. Best to wait for reaction at that level.

Below 1.35623 and try to go short. Cut the trade if price deviates and quickly go Long.

This would be the most attractive setup so far. There is the option of a bounce to 1.37 - 1373. If that option starts to present itself, I will update the post. For now only price deviation and a break of the mid level is what we will take into account

Disclaimer: This content was originally published on Zelf Trade.