USD/CAD Elliott Wave
Since our last analysis, the USD/CAD pair has been trading upwards, just like we expected, impulsive wave 1 (coloured blue) of the bigger wave (5) (coloured green) has been developing. During the Friday's Asian and European sessions we could observe strong ascending move from 1.0129 towards the 1.01235 level and we can consider this movement as the end of the impulsive wave (3) (coloured pink) of the bigger wave 1 (coloured blue). Therefore, during the New York session this major currency did not manage to hold this level and price has retraced back to 1.0157 area. At the moment the USD/CAD pair is developing a triangle pattern that is usual for the corrective wave 4 and we expect to see the price back to bullish mood very soon. In accordance with our wave rules and taking into account that wave 5 should retrace 78.6% of waves 3, we can define the potential targets with measuring wave 3 with take profit at 1.0241 (78.6% of wave 3). To reduce the risk, we can use invalidation point at 1.0141 level as stop loss.
Support and Resistance
(S3) 1.0005 (S2) 1.0064 (S1) 1.0117 (PP) 1.0176 (R1) 1.0229 (R2) 1.0288 (R3) 1.0341
Trading forecast
Proceeding from Elliott Wave rules today, the trend is expected to begin the upwards movement. That is why long positions at level 1.0175 with stop loss at 1.0141 and take profit at 1.0241 are recommended.
