USD/CAD Elliott Wave
Since our last analysis the USD/CAD pair has been trading side-ways, corrective wave (4) (coloured pink) of the bigger wave 1 (coloured blue) has been developing. Yesterday, during the Asian session we could observe slight descending movement from 1.0179 towards the 1.0156 level and we can consider this move as the end of the corrective wave (4) (coloured pink). Therefore, during the European and New York sessions this commodity currency did not manage to hold this level and the price has reached a new daily high at 1.0213 area. At the moment the USD/CAD pair is trading around 1.0168 level and we expect to see the price above 1.0240 in the next few sessions. In accordance with our wave rules and taking into account that the wave 5 should retrace 78.6% of the 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) 1.0086 (S2) 1.0120 (S1) 1.0144 (PP) 1.0178 (R1) 1.0202 (R2) 1.0236 (R3) 1.0260
Trading forecast
Proceeding from Elliott Wave rules today, the trend is expected to begin the upwards movement. That is why long positions at level 1.0177 with stop loss at 1.0141 and take profit at 1.0241 are recommended.
