USD/CAD – 1.2186
Trend: Down
Original strategy :
Sold at 1.2240, Target: 1.2080, Stop: 1.2240
Position: – Short at 1.2240
Target: – 1.2080
Stop: – 1.2240
New strategy :
Hold short entered at 1.2240, Target: 1.2080, Stop: 1.2240
Position: – Short at 1.2240
Target: – 1.2080
Stop:- 1.2240
As the greenback found support at 1.2121 today and has rebounded, suggesting further consolidation would take place, however, as long as indicated resistance at 1.2240 holds, bearishness remains for recent decline to resume after consolidation, below said support at 1.2121 would signal the rebound from 1.2061 has ended, bring retest of this level later, below there would confirm recent decline has resumed and extend weakness towards psychological support at 1.2000 but loss of downward momentum should prevent sharp fall below 1.1950-60, bring rebound later. 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 ended at 1.2778, wave v has reached our indicated downside target at 1.2100 and may extend to 1.2000.
In view of this, we are holding on to our short position entered at 1.2240. Above 1.2240-50 would risk rebound to 1.2300 but only break there would defer and signal a temporary low has been formed, bring a stronger rebound to 1.2335-40, however, upside should be limited to resistance at 1.2429 and price should falter well below 1.2490-00.
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.
