Weekly gain/loss: - 96 pips
Weekly closing price: 1.3169
Weekly view: Following a decisive close below support at 1.3381 two weeks back, the sellers extended this decline last week in the shape of a near-full-bodied bearish candle. To our way of seeing things, weekly price action below here looks relatively cramped. The only level that really catches our eye right now is the trendline support taken from the high 1.1278.
Daily view: The retest of resistance at 1.3295 on Wednesday, as you can see, sparked a selloff during Thursday and Friday’s sessions. Consequent to this, the commodity currency now trades within touching distance of Quasimodo support carved from 1.3139. As we hope is demonstrated on the chart, the Quasimodo level also sports a 78.6% Fib support at 1.3129 (taken from the low 1.3006) and two nearby trendline supports etched from the lows 1.2460/1.2763.
H4 view: Recent action over in the oil market shows that price extended Thursday’s bounce from H4 support at 49.80 and went on to clock fresh highs of 51.63 by the closing bell. Following a retest to the underside of the 1.32 handle the USD/CAD pushed further into losses on Friday, reaching lows of 1.3152 by the week’s end.
Direction for the week: According to weekly structure, there is scope for further downside. However, the daily chart, as mentioned above, shows that a support in the form of a Quasimodo pattern is lurking nearby. With the potential for a rebound from this area being reasonably high, our desk has noted that medium-term direction is limited at the moment.
Direction for today: Sitting just beyond the nearby H4 mid-way support at 1.3150 is a H4 demand base coming in at 1.3106-1.3141. Taking into account that this zone houses the daily Quasimodo support at 1.3139 and its partner 78.6% Fib support at 1.3129, as well as October’s opening level at 1.3120, this area could potentially act as a magnet to price today.
Our suggestions: We have two grumbles regarding a buy from the above noted H4 demand area. The first is the weekly chart threatening us with the possibility of further selling this week. Secondly, seeing as how the H4 demand is positioned just ahead of the psychological level 1.31, the possibility of a fakeout is high. Looking on the bright side, nevertheless, there is, as explained above, a strong collection of supports fixed around the H4 demand!
Therefore, we support a buy from here if, and only if, a H4 bull candle forms. Of course, this will not guarantee a winning trade, but what it will do is show one that there are interested buyers, hence lessening the likelihood of being stopped out.
Data points to consider today: There are no high-impacting news events on the docket today relating to these two markets.
Levels to watch/live orders:
• Buys: 1.3106-1.3141 (reasonably sized H4 bullish close required prior to pulling the trigger, stop loss: ideally beyond the trigger candle).
• Sells: Flat (stop loss: N/A).
Weekly closing price: 1.3169
Weekly view: Following a decisive close below support at 1.3381 two weeks back, the sellers extended this decline last week in the shape of a near-full-bodied bearish candle. To our way of seeing things, weekly price action below here looks relatively cramped. The only level that really catches our eye right now is the trendline support taken from the high 1.1278.
Daily view: The retest of resistance at 1.3295 on Wednesday, as you can see, sparked a selloff during Thursday and Friday’s sessions. Consequent to this, the commodity currency now trades within touching distance of Quasimodo support carved from 1.3139. As we hope is demonstrated on the chart, the Quasimodo level also sports a 78.6% Fib support at 1.3129 (taken from the low 1.3006) and two nearby trendline supports etched from the lows 1.2460/1.2763.
H4 view: Recent action over in the oil market shows that price extended Thursday’s bounce from H4 support at 49.80 and went on to clock fresh highs of 51.63 by the closing bell. Following a retest to the underside of the 1.32 handle the USD/CAD pushed further into losses on Friday, reaching lows of 1.3152 by the week’s end.
Direction for the week: According to weekly structure, there is scope for further downside. However, the daily chart, as mentioned above, shows that a support in the form of a Quasimodo pattern is lurking nearby. With the potential for a rebound from this area being reasonably high, our desk has noted that medium-term direction is limited at the moment.
Direction for today: Sitting just beyond the nearby H4 mid-way support at 1.3150 is a H4 demand base coming in at 1.3106-1.3141. Taking into account that this zone houses the daily Quasimodo support at 1.3139 and its partner 78.6% Fib support at 1.3129, as well as October’s opening level at 1.3120, this area could potentially act as a magnet to price today.
Our suggestions: We have two grumbles regarding a buy from the above noted H4 demand area. The first is the weekly chart threatening us with the possibility of further selling this week. Secondly, seeing as how the H4 demand is positioned just ahead of the psychological level 1.31, the possibility of a fakeout is high. Looking on the bright side, nevertheless, there is, as explained above, a strong collection of supports fixed around the H4 demand!
Therefore, we support a buy from here if, and only if, a H4 bull candle forms. Of course, this will not guarantee a winning trade, but what it will do is show one that there are interested buyers, hence lessening the likelihood of being stopped out.
Data points to consider today: There are no high-impacting news events on the docket today relating to these two markets.
Levels to watch/live orders:
• Buys: 1.3106-1.3141 (reasonably sized H4 bullish close required prior to pulling the trigger, stop loss: ideally beyond the trigger candle).
• Sells: Flat (stop loss: N/A).
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