USD/CAD – 1.2500
Trend:Â Down
Â
Original strategy      :
Sell at 1.2550, Target: 1.2350, Stop: 1.2610
Position: –
Target:Â –
Stop: –
Â
New strategy            :
Sell at 1.2595, Target: 1.2395, Stop: 1.2655
Position: –
Target:Â –
Stop:-
As the greenback has recovered after holding above previous support at 1.2414, suggesting further consolidation above this level would be seen and another bounce to 1.2540-50 cannot be ruled out, however, reckon upside would be limited to 1.2600 and bring another decline later, below said support at 1.2414 (wave iii trough) would confirm recent decline has finally resumed and extend weakness to 1.2350, then towards 1.2300. We are keeping our count that wave v as well as wave (C) ended at 1.3794 and impulsive wave (i ii, i ii) is now unfolding with minor wave iii ended at 1.2414, followed by wave iv correction possibly ended at 1.2778, wave v should extend towards 1.2300.
In view of this, we are looking to sell again on recovery as 1.2600 should limit upside. Only above 1.2630-35 would defer and prolong consolidation, risk rebound to 1.2660 but resistance at 1.2691 should hold from here, bring further consolidation. Above 1.2691 resistance would risk a stronger rebound to 1.2740-50, however, said resistance at 1.2778 should hold. In the event the pair breaks said resistance at 1.2778, this would abort and signal the rebound from 1.2414 is still in progress for retracement of recent decline to 1.2825-30 but still reckon upside would be limited to 1.2880-85 (50% Fibonacci retracement of wave iii) and price should falter well below 1.2990-95 (61.8% Fibonacci retracement), bring retreat later.
To recap, wave B from 1.3066 is unfolding as an a-b-c and is sub-divided as a: 1.2192, b: 1.2716 and wave c is a 5-waver with i: 1.1983, ii: 1.2506, extended wave iii with minor iii at 1.0206, wave iv ended at 1.0781 and wave v as well as wave iii has ended at 0.9931, hence the subsequent choppy trading is the wave iv which is unfolding as (a)-(b)-(c) with (a) leg of iv ended at 1.0854, followed by (b) leg at 1.0108 and (c) leg as well as the wave iv ended at 1.0674. The wave v is sub-divided by minor wave (i): 0.9980, (ii): 1.0374, (iii): 0.9446, (iv): 0.9913 and (v) as well as v has possibly ended at 0.9407, therefore, consolidation with upside bias is seen for major correction, indicated target at 1.3700 and 1.4000 had been met and further gain to 1.4700 would be seen later.
