Today I’m going to show you exactly how I’m trading the USDCAD.
I’ll share key support and resistance levels to watch and bullish and bearish triggers that could offer an opportunity next week.
Check out the USDCAD video below and scroll down for the annotated charts and analysis.
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On June 19th, I wrote about an area of confluence for USDCAD at 1.3100.
Although the pair didn’t make it that far before bouncing, it did retest the bottom of the descending channel at 1.3115 that I mentioned in that post.
With USDCAD hovering just above 1.3240 this week, that becomes a trigger for next week’s price action.
A sustained break below 1.3240 on the higher time frames would expose the 1.3100 confluence of support.
See the video above for why 1.3100 is significant.
Alternatively, a sustained break above 1.3340 next week would be the bullish trigger for a move to channel resistance at 1.3500.
The 1.3340 area is the November trend line and the channel’s mid-range.
However, it’s essential to wait for a confirmed setup from USDCAD.
Trading the pair between 1.3240 and 1.3340 is unfavorable, given where the US Dollar Index (DXY) is today.
Furthermore, the risk-to-reward ratio isn’t favorable enough for trading USDCAD in the current range, at least not for me.
But these bullish and bearish triggers should offer a favorable opportunity next week, so I’m happy to wait.
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