Lower prices still expected to be seen on the Loonie.

FX:USDCAD   U.S. Dollar / Canadian Dollar
95 0
Weekly Timeframe: Three weeks ago, selling interest came into the market a few pips below a major weekly supply area seen at 1.18061-1.14739, consequently encouraging follow-through selling. As per this timeframe, it appears the path south is potentially clear down to at least 1.09394, since we believe most of the near-term demand has already likely been consumed – check out the demand consumption tails seen at 1.11211/1.10807. Let’s see what we can find on the lower timeframes.

Daily Timeframe: The daily timeframe currently shows that price is trading off of a minor daily supply area seen at 1.13681-1.13024. Assuming that the sellers show further strength here, a move south could ensue down towards a daily demand area coming in at 1.11211-1.11813. With that being said, this daily demand area would need to be consumed before further selling from the weekly supply area mentioned above at 1.18061-1.14739 is seen.

4hr Timeframe: The 4hr timeframe shows that aggressive selling interest came into the market around the 4hr supply area seen at 1.13238-1.13026. This is good for us, since if you remember we took a short trade at 1.12979. At the time of writing, we do not see any opportunities to add to our position just yet, and we certainly see no areas of demand that is causing us any concern.

This is how we see the trade playing out. Ultimately, we’re targeting a 4hr demand area seen below at 1.11211-1.11454 (located deep within the daily demand area mentioned above at 1.11211-1.11813). However, before we reach our destination, we are expecting to encounter some road bumps. Buying opposition will likely come into the market around 1.12513, which as you can see is happening right now. The 1.12 level seen below is also a place where we expect a mini battle to take place. Assuming that all goes to plan here, we will be attempting to add to our position on the break and retest of each level just mentioned (as per the blue arrows).

Buy/sell levels:

• Buy orders: N/A (Predicative stop-loss orders seen at: N/A).

• Sell orders: 1.12979 (Predicative stop-loss orders seen at: 1.13276).
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