USD/CAD Elliott Wave
For the last few days the USD/CAD pair has been trading downwards, corrective wave 4 (coloured blue) of the bigger wave [1] (coloured red) has been developing. Yesterday, during the Asian session we could observe descending movement from 1.0523 towards the 1.0457 level and we can consider this move as the end of the sub-wave a (coloured green) of the wave 4 (coloured blue). Therefore, during the European and New York sessions this commodity currency did not manage to hold this levels and the price has retraced back to 1.0546 level (end of the flat sub-wave b). At the moment the USD/CAD pair is trading around 1.0478 and we expect to see the price higher when development of the wave 5 (coloured blue) starts. In accordance with our wave rules and taking into account that wave 5 should retrace 61.8% of wave 3, we can define the potential targets with measuring wave 3 with take profit at 1.0666 (61.8% of wave 3). To reduce the risk, we can use support point at 1.0366 level as stop loss.
Support and Resistance
(S3) 1.0376 (S2) 1.0416 (S1) 1.0466 (PP) 1.0506 (R1) 1.0556 (R2) 1.0596 (R3) 1.0646
Trading forecast
Proceeding from Elliott Wave rules today, the trend is expected to begin the upwards movement. That is why long positions at level 1.0500 with stop loss at 1.0366 and take at 1.0666 are recommended.
