As the USD is still weak, and having M. Yellen pretty much admitting to it, it has given the CAD an extra boost to get back to the previous support. As Oil is getting weaker and CAD is still getting stronger, it’s just a matter of time before price needs adjustment and CAD will need to give back a few cents on the dollar. Presently we are in the midst of a double bottom on the Daily charts, for anyone looking to get in to this market you might want for a more precise entry on the lower time frames like an H1 Double bottom. We will still be looking for a sell signal around the 38.2- 50 % retrace upon a price action signal.  In this scenario our bias stays the same AS LONG AS SUPPORT HOLDS. If we break through support we will be looking for a new support of 1.26.

Play safe!!

WTI H1

 

WTI H1 30

USDCAD D1

usdcad D1 30

USDCAD H1

USDCAD H1 30

2 thoughts on “IS USDCAD RIPE FOR CHANGE? 31-03-16”

  1. Ryan Gandalf van Jaarsveld says:

    Hi Guy – thank you for the post. Yesterday’s DOE data showed a decline in oil inventories as it came in lower than last week and lower than consensus – so that’s good for oil right? I see the double bottom on the daily chart and also notice that we were been below MS2 on the 17 March – retraced, hit the daily 21 and then came back down. We currently sit below monthly S2 again and also weekly S2 – having also formed a double bottom on H4 and therefore H1. We all know that S2 is a key reversal pivot so one would expect price to rise. Looking at WTI on the daily chart – we broke way above MR2, hit the 200 EMA, came down and are currently at the daily 21. With R2 being a key reversal pivot I would expect a retracement. Having said all of this I feel that price could not go any higher on oil due to us being so far above MR2 and seeing that we hit the 200 EMA on the 18 March one would expect a lot of bears to jump in here and the price of oil falling closer to the monthly central pivot and not MM4. I am eager to see what happens at the start of the month. Do we continue rising to the next bull profit target, do we fall with bears taking control or do we continue in a range? It is quite clear that the price cannot go too high to avoid a supply issue and it can’t go too low to avoid risk off sentiment. So maybe the range idea makes the most sense. The bottom line is that at the moment USDCAD has every reason to go up technically speaking and oil has every reason to go down technically speaking. If USDCAD does move up then I will sell at the daily 21 and then sell again at the daily 55 – if we break both of those then my bias will have to change very quickly.

    Guy – as mentioned previously I am very new to Forex. If it is clear that I am completely off track please let me know and advise what I am doing wrong as I would be very keen to learn from you. Your posts are always great and very helpful. I intend to master FX and I know it is impossible to achieve that without great teachers like yourself and the rest of the team here at Forex.Today. Of course with our fearless leader WM at the helm I find myself in very good company.

    1. Guy Pelletier says:

      @ RYAN The 21 and 55 EMA’s are a good tool, but you also want to define your resistance and support zones, depending on the market and trading pair they can be very important.

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