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GBPCAD reached our 500 pip objective today at 1.6800.
I first wrote about this inverse head and shoulders pattern on September 9.
At the time, GBPCAD was trading just below the neckline at 1.6260.
I also made a video on October 2 explaining why I felt the GBPCAD was due for a move higher up to 1.6800 and perhaps even 1.6960.
For those who saw last Saturday’s forecast video, you know that there is also an ascending channel in play here.
Here’s the GBPCAD portion of Saturday’s video:
Notice how GBPCAD tested this confluence of support at 1.6250 last week and again this week before catapulting higher.
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Buyers kept prices above that 1.6250 area, so this bullish reversal pattern was always intact.
So now that the 500 pip target is behind us, where to next week?
As always, it’s going to come down to today’s close at 5 pm EST.
If GBPCAD can manage a close above 1.6600, I would expect buyers to defend the area as new support next week.
Notice how the pair stalled out at 1.6600 in the second half of September.
Therefore, a close above it today would likely keep the rally intact as we head into next week.
Alternatively, a daily (and weekly) close below 1.6600 would expose the next key support at 1.6440 for next week.
Based on how the price action looks with just one hour to go before the close, I would say GBPCAD buyers have more fuel in the tank.
And just like I’ve mentioned recently, if buyers can hold onto this short-term trend, we could see GBPCAD tag the 1.6960 region within the next few sessions.