Unfortunately, I was a bit too late to take advantage of the setup on the EURUSD pair. This pair retraced nicely along a resistance turned support zone and held up for a further bullish rally.
Here is is the chart setup in question:
Over on the hourly chart, you can see that it is holding up quite nicely. In my earlier post, I did say this pair would be kept on the back burner and wouldn’t be one I would actively be monitoring.
Let’s move onto the two trades that I am currently:
The USDCAD short position is currently in the money as the 4-hour support turned resistance level is holding up nicely. I marked the next major point of support in this down-trend at the 1.3440~ level. This was a resistance turned support that held up quite a while ago so we will once again determine if it holds any strength. There is currently another 50 pips to go in order to hit that level.
Meanwhile, I took a long position on this pair after consideration that the resistance level simply isn’t going to hold up. Although initially I was bearish, but the strong break-out through the resistance zone was the first indication that this is a bullish move.
The second indication is the correlation of the USDCAD and AUDUSD pair. I was initially bearish on the AUDUSD pair, but I had already shorted the USDCAD pair. It only makes sense to take on a short position if both pairs share a strong positive correlation. This proves not to be the case.
Here is the daily correlation:
Currently, I don’t have trade exit plans since both trades are still to what I consider to be in the initial moves. My targets will be mostly be to tighten stop losses as these trades approach the nearest relative highs or lows.