USD/CAD Elliott Wave
Since our last analyses, the USDCAD pair has continued trading downwards, impulsive wave 5 (coloured green) of the bigger wave (1) (coloured blue) has been developing. Yesterday, during the European session we could observe ascending movements form 1.0288 towards the 1.0318 level and we can consider this move as the end of the .2 wave (coloured black) of the bigger 5 wave (coloured green). Therefore, during the New York session this commodity currency pair did not manage to stay at the highs and the price dropped to the new low at 1.0200. At the moment, the USDCAD is trading around 1.0210 and we are expecting to see one small push lower before the price turns around when developing of the (2) wave (coloured blue) starts. In accordance with our wave rules and taking into account that wave 2 should retrace 50% of wave 1, we can define the potential targets with measuring wave 1 with take profit at 1.0370 (50% of wave 1). To reduce the risk, we can use invalidation point at the 1.0100 level as stop loss.
Support and Resistance
(S3) 1.0059 (S2) 1.0129 (S1) 1.0176 (PP) 1.0246 (R1) 1.0293 (R2) 1.0363 (R3) 1.0410
Trading forecast
Proceeding from Elliott Wave rules today, the trend is expected to begin upward movements. That is why long positions at the level of 1.0250 with stop loss at 1.0100 and take profit at 1.0370 are recommended.
