The Loonie has been hovering between 1.31 and 1.39 for the past two years, and we're quickly approaching the upper boundary of this weekly range. Will there be another sell-off?
Let's dive into what the price charts reveal. We're riding a 17-week uptrend on the weekly chart, with last week's candle showing an especially bullish move—over 200 pips—pushing us near the top of the range. Historically, the final push to the range's peak tends to be the most bullish, as shown in the chart below.
This pattern suggests that it might be a good time to consider selling once the right signal appears. On the daily chart, we see a similar pattern: the last leg up to the range top is usually the most significant.
Below is the sell zone chart, indicating where I plan to look for sell signals between 1.38 and 1.39 using my TRFX indicator.
I anticipate that the market will reach this sell zone in the next few days. Then, I'll wait for a sell signal on the 4-hour charts or higher.
The target for this trade is the bottom of the range at 1.31. Based on past patterns, the price should drop to this level fairly quickly.
This trade idea would be void if there's a clear break and a weekly close above 1.39. If that happens, expect a move up to the significant monthly SUPPLY/SELL zone starting at 1.40.
Would love to hear your thoughts in the comments below
Taking into account the Pin-Bar forming - I think that the price will make a downward movement once again).
linofx1
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Great technical analysis 👏
JoeChampion
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More likely to the upsides, strong US data, good technicals and USD is considered a safe haven in this environment!
TheFxAce
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@JoeChampion your forgetting to factor in oil in times of war 🤔
still would have to break 1.39 if it's going to go higher.
deany_p
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Head and shoulder pattern now formed on the 4HR, waiting for a clear break of the neckline for a sell, could yet retrace to test the 1.385 level then reject again. A good idea to keep an eye on the oil charts and the DXY, tis the sell season on the pair. Bias is a drop towards 1.358 to fill the imbalance. Lets see how Monday plays out.