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EURCAD: Shorts Favored Below 1.5690

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Important: I use New York close charts so that each 24-hour period closes at 5 pm EST.

Click here to get access to the same style charts I use on this website.

In the April 1 weekly forecast, I mentioned a EURCAD trend line break on the 4-hour chart that could produce an opportunity to get short. Less than 24 hours later a bearish pin bar formed at 1.5880.

That was the signal to get short for those interested. It’s turned out to be a profitable trade thus far with the EURCAD down as much as 415 pips since that pin bar.

However, in that same April 1 forecast, I pointed out an ascending channel on the daily time frame. The pattern stretches back to the first half of last year and has been responsible for several 1,000+ pip moves.

Although the EURCAD has lost significant ground in the last four weeks, the pair is still hovering approximately 300 pips above channel support.

Moreover, the EURCAD recently closed below the 1.5690 area. You can see how last Monday’s session encountered an influx of selling pressure above this area.

To the downside, we have 1.5510 followed by the 1.5370/80 area. So the idea, at least for me, is rather straightforward. A return to the 1.5690 resistance area would trigger an opportunity to get short for a move back to 1.5510 and perhaps 1.5370/80.

There’s no guarantee that the EURCAD will make it back there before losing additional ground. If not, I’ll stand aside as I certainly don’t want to chase.

The broader ascending channel is also one to keep an eye on over the coming weeks. Depending on how the pair reacts to channel support, it could either be an opportunity to get long or a chance to get short. Time will tell.

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EURCAD daily time frame

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9 comments
Cecilia says

Hi. Can you please clarify something for me.What is the significance of analysing large timeframes and then switching on to smaller timeframes to wait for a reversal candlestick signal for tradequate entries. Thanks.

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Pawel says

Thanks for sharing. In fact, I noticed something similar in AUDCAD.

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Admas Engdashet says

i like to u contniue

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Tafi says

Brilliant!

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Howard says

just at the ma cross…very nice! thanks Justin

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Babbi says

noted with thanks

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Felino+JR+Ignacio says

Thank you, Justin Noted

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    AbdulRasheed says

    good

    Reply
Darius says

I saw this pinbar and add sell limit order to get a better price – and it never reached and I missed the profit. I have noticed that it always for me goes to another side when I enter with those bearish pinbars, so thats why I wanted to get better price and risk reward ratio. Because I still had to use SL high enough to not get stopped out too early.
I tried to sell at 1,59059, SL 1,60131 and TP 1,53890. That is 4,82 r/r. But I am not even sure if I should get at least 2 r/r on key level 1,569. This time I would have got 2,01 r/r. But if I would have sold at current market price, then I would have lower than 2 r/r till first key support. I do not get it.
How other made the profit here? My SL also does not look too wide having in mind that there is lot of volatility – some candles were very big few days before.

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