The USDCAD has been my focus pair for quite the past while and that is when I see a trend reversal, it is a great opportunity to take it. With relatively weakening U.S. data, this provides a good fundamentals support for my short trades.
The USDCAD sold off for the third month in a row which only spells good news as we are seeing a strong momentum.
Over on the monthly chart, we see a retreat from 2003 highs. The resistance zone is holding up and I believe for the next little while until price retraces to the 1.20~ mark.
Over on the hourly, this is a nice consolidation setup with an almost guaranteed break lower trade opportunity. I wouldn’t enter a short position on market open just yet as this consolidation is still under way and could take up to the next two trading days to play out.
Surprisingly, the EURUSD is also another good trade. As I am bearish on the U.S. Dollar against the Canadian, the technical setup of this pair suggests a bearish move to come. One important consideration to give is to place less emphasis on the latest few candles given it represents the close-out of longs before the weekend. Surely, we may see traders continue to long the Euro in the upcoming weeks.
Given the volatility on the EURUSD pair and similar Euro Zone and Aus-Asian pairs, the I have been scalping the USDCAD quite a bit last week and will continue to do so for the upcoming week as well.