ICmarkets

USD/CAD: Technical outlook and review.

FX:USDCAD   U.S. Dollar/Canadian Dollar
52 0 0
Weekly TF: Once again, price is currently trading around a weekly supply area at 1.10522-1.09996. Was the initial touch at 1.09967 just to draw the sellers in, only to retrace price back up to this area forcing traders to cover their positions? We have seen this kind of move time and time again, and it usually results in a heavy being seen.

Daily TF: A small push above a daily supply area at 1.09967-1.09401 has likely opened up the possibility for a test of the daily supply area at 1.10522-1.10133 (Set deep within the weekly supply area just mentioned above). So, with this in mind, a push deeper into the weekly supply area may well be seen sometime this week.

4hr TF: After the heavy round of buying seen on the Loonie, selling interest has come into the market around the huge psychological number 1.1. Is this selling interest genuine, or is it just traders covering their long positions? If it’s genuine, we can expect a drop down to at least the 4hr S/R flip level support at 1.09311.

On the contrary, a push above the round number level up to the 4hr supply area at 1.10388-1.10163 is what we’re currently watching for at the moment. One can only imagine the amount of stops situated just above this level, not to mention the breakout buyers’ buy orders as well. Now, if these stop orders get filled, automatically becoming buy orders, this would likely generate liquidity for pro money to sell into.

Therefore, this is what we have in our favor for a short trade just below the aforementioned 4hr supply area (pending sell order set just below at 1.10127):

1. Currently trading within not only daily supply at 1.10522-1.10133, but also weekly supply at 1.10522-1.09996 as well.
2. Fresh, untouched 4hr supply mentioned above.
3. A perfect fakeout zone for pro money take full advantage of (the area in between the round number 1.1, and the aforementioned 4hr supply area.

Pending orders/P.A confirmation levels:

• Areas to watch for buy orders: P.O: 1.08028 (SL: 1.07884 TP: Dependent on how price approaches). P.A.C: No P.A confirmation buy levels are seen in the current market environment.

• Areas to watch for sell orders: P.O: 1.10127 (SL: 1.10440 TP: Dependent on how price approaches) P.A.C: No P.A confirmation sell levels are seen in the current market environment.
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