Here is the Top-Down Analysis of GBPCAD (Monthly, Weekly, Daily for direction and 4H for entry) for
Week 43 - 19 Oct
M > Market is moving in a well respected horizontal structure (of course with minor breakouts). Price moved up to test structural resistance and dropped till monthly support to face rejection again. While dropping each month bottom wick is getting filled by next monthly candle.
W > On its way down price created an M formation and as expected price moved up to test the neck before continuing with move.
D > We had expected price to move up to test neck of M formation but price reversed from neck after completing M formation after struggling for a week with rejection wicks. Price is now creating HH and HL, it is now moving down and we expect it to move to test last weekly support in middle of the range. We will have let go of target of neck of M formation for sometime.
As per GBP saw closure of both Long and Short positions improving net positions but still in -ve, whereas N-R could not gauge the same path and they went opposite with addition of both Long and Short. Commercials closed both Long and Short positions, Short for them reducing further to least for current year. BXY had further improved its position during the said week but it weakened last week. CAD saw addition of major Long and closure of Short positions with Short positions further reducing to least for current year, improving net positions (still in -ve). CXY further gained strength during the said week but weakened a bit last week.
4H > Price is moving down creating HL and LL. We expect it to continue with move but with correction pull back.
Recommendation > Market is ideal for swing as well as intraday trading with each daily candle moving about 100 pips.
Pair Correlation: GBPCAD has positive correlation with GBPCHF , GBPUSD , GBPJPY and GBPNZD and negative correlation with EURGBP .
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