FX.co ★ USD/CAD Wave Analysis July 23, 2012

USD/CAD Elliott Wave
Since our last analysis the USD/CAD pair was trading in an upward move developing impulsive wave 1 (coloured blue) of the bigger wave (1) (coloured green).During the Friday’s Asian and European sessions we could observe an ascending movement towards the 1.0130 level where this major pair found resistance and price started pushing lower. Therefore, during the New York session the USD/CAD pair didn't manage to hold this level and the price continued trading in a bullish mood till the end of the session. Today we could observe the price trading around 1.0160 level, and we can consider this level as the end of the wave 1 (coloured blue). In accordance with our wave rules and taking into account that the wave 2 retraces 61.8% of the wave 1, we can define the potential targets with Fibonacci retracement (1.0065-1.0160) with Take Profit 1 at 1.0111 (50% of wave 1) and Take Profit 2 at 1.0100 (61.8% of wave 1). Resistance at 1.0185 point can be used as Stop Loss.
Support and Resistance
(S3) 1.0045 (S2) 1.0069 (S1) 1.0083 (PP) 1.0107 (R1) 1.0131 (R2) 1.0145 (R3) 1.0169
Trading Forecast
Proceeding from Elliott Wave rules today, the trend is expected to begin the downward movement. That is why short positions at level 1.0150 with Stop Loss 1.0185, Take Profit 1 at 1.0111 and Take Profit 2 at 1.0100 are recommended.