The last time we discussed the USDCAD the pair was trading at 1.2475. Buyers had just broken out from the confluence of resistance at 1.2400/20 and looked poised to take the price higher.
Over the next 48 hours, the 1.2400/20 area was tested as new support. It passed the test, and after three weeks of sideways movement, the pair finally made its way toward the target at 1.2770.
However, we would have expected the 1.2770 handle to attract bids during Friday’s (November 3) session. After all, it served as resistance back in mid-August and seemed to support the rally efforts during the October 26 session.
That didn’t happen. Instead, sellers closed Friday below 1.2770, and the level attracted an influx of selling pressure on Monday. It seemed the USDCAD would slide lower toward the October 6 and 17 highs near 1.2590.
But it appears that buyers aren’t ready to throw in the towel just yet. At the moment, the pair is hitting fresh session highs above 1.2770.
Now, that doesn’t mean the uptrend is intact and all is well for buyers. As you may well know, I don’t place much weight on the price action that occurs before the New York close at 5 pm EST.
If USDCAD bulls do manage a daily close above 1.2770, though, we could see a return to recent highs at 1.2915 and perhaps even the 1.3000 area. It’s the location of several prominent lows including October of 2016 and January of this year.
A daily close (5 pm EST) back above 1.2770 would have us watching for a buying opportunity on a retest of the area as new support. Key resistance from there would come in at 1.3000 with another area of interest at the recent highs near 1.2915.
Alternatively, if the pair closes today below 1.2770, it would suggest that sellers remain in control. It would also expose those October highs I mentioned at 1.2590.
Want to Be Mentored by Justin? Get Access Inside the Free Webinar
Hi, Thanks for your very clear and accurate description about pairs but sometimes very late be glad if you kindly remember that so many traders waiting for your guidance, please.
Very late? Mind clarifying?
Thanks for the heads up. Being doing great recently. Thank you
You’re welcome, Steve. Cheers.
Thank you for the efforts made to keep me updated. I have a question. When am using Fibonnacia expansion. Which time frame must I use to take my profits, if I had used D1 or Weekly to determine direction of trend
Thank you sir. I follow your advice to the letter hoping it will turn my misfortune around.
Take care ( Pura Vida)
Justin your price action analysis is so clear ,neat and limpid. I think it might be the best out there, at least for me…Did you develop this method yourself? or some mentor taught you?
Hi Justin,
Do you consider the channel from September low to October to be a valid one? If not, would you be so kind as to tell why? Or, if you can refer to an article already posted, I didn’t find any when I search the site.
In anyway, thank you very much for your regular posts, they really help to have a better understanding of the forex market.
Hi Justin,
I finally found an article on channel on your site using “equidistant channel” to search. The channel on USDCAD seem to meet the requirements. But I might missed something.
And in the end….USDCAD crashed…