Short

Updated

USD / CAD - Weekly Pin Bar - SHORT

Trump has again decided to influence the US$, despite some pretty strong economic numbers coming out, the DXY rejected the 95.5 high for about the 10th time and the Canadians have produced some good CPi numbers, just as we hit the 50% fib level, he obviously wants a cheaper currency for many reasons. On the Charts, the DXY was divergent on the weekly time frame, so we've been expecting a correction to the downside anyway.

While Crude is moving sideways right now, it is in a long-term bullish trend, strengthen CAD and therefore, I'm looking for a break of the long-term trend line at 1.31. Should that happen with some strength and it holds, then I would expect to reach one of two targets, both fib levels, 1.29 and 1.275

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Look at that pin bar on the weekly time frame, supported by the engulfing candle on the daily as the second move to the downside from 1.335, the third rejection.

Trade active

Breaking trend line, I'm in early, but like the look of it

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I hours later and we didn’t break the trend line over night, in fact the USD looks stronger.

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Crude has weakened on oversupply worries impacting CAD, $ bounces back after increased treasury yields and less Trump tweets (today anyway).

The best pair would be AUD / USD rather than USD / CAD

Trade closed manually

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We've broken the trend line, look for a pullback to get in.

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The pull line is my 21 day EMA

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Blue horizontal line is the bottom of the 21 day EMA

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The US$ is rocketing, so I won't be taking this trade until we know where Oil is going. I would check out my AUD / USD trade instead

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The bulls will be looking to break this trend line, then smash through it, pullback and hold, resistance becoming support, if that happens, they will be back into the bull channel

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If we don't break the trend line, we can sell down from there

Trade active

Failed to break, trade is now active US$ is now dropping against the other currencies

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Crude is now rocketing up, increasing the price of CAD

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Crude continues to drive higher, we're now pulling back, bringing in more buyers and driving CAD higher, forcing the US$ down.

The DXY is selling off nicely

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We're going much lower yet... Red $ is declining fast while Orange CAD is rising still.

The DXY has a while to fall yet

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More importantly, the reason these trades have moved, it's Crude Oil! No other reason fuelled this action at this rate.

Higher oil prices will drive up the Canadian and Aussie dollars, Bond yields will help move the dollar. So be aware of this when looking at other pairs and Equities will be impacted by the reduced dollar and increased Oil, they will go up.

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My target is 1.29 and 1.28 the major fib levels

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Look at the support that 1.295 should that be broken, then we'll move down to retest the edge of the channel @1.29-1.28 this is the fib level and the EMA, we'd need a strong Bull trend on Crude and a weak or stagnant US$. Who knows with all the geopolitical games going on.

Lots of components fundamental and technical to keep our eye on here.

The very big picture, this pair have been in decline since 2016, are we about to resume that trend?

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Lovely rejection of 1.31 confirms we're going lower

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Beautiful

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I've been in this since the middle of July, still confident we're going for the edge of the channel below 1.29 - 1.28

CBMotivation

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CBMotivation

Also on:

Related publications

How to enter a trade at the right time!

by CBMotivation