USD/CAD – 1.3245
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Recent wave: Only wave v of c has ended at 0.9407 and wave C of major A-B-C correction is underway for headway to 1.4700
Trend:Â Near term down
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Original strategy      :
Sold at 1.3500, met target at 1.3330
Position: – Short at 1.3500
Target:Â – 1.3330
Stop: –
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New strategy            :
Sell at 1.3330, Target: 1.3130, Stop: 1.3390
Position: –
Target:Â –
Stop:-
The greenback finally dropped in line with our bearish expectation, our short position entered at 1.3500 met downside target at 1.3330 with 170 points profit, this anticipated selloff adds credence to our view that top has been formed at 1.3794 earlier and downside bias remains for the decline from there to extend weakness to 1.3200, then towards 1.3130-40, however, near term oversold condition should limit downside to 1.3100 and previous support at 1.3078 should remain intact.
As we have taken profit on our short position entered at 1.3500, would not chase this fall here and would be prudent to sell again on subsequent recovery as 1.3330-40 should limit upside. Above previous support at 1.3387 (now resistance) would defer and suggest low is possibly formed, bring a stronger rebound to 1.3420-25 but break there is needed to provide confirmation.Â
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.
