March Canadian Dollar
I spent some time breaking down the structural evidence of our neighbor to the north’s currency market. I always favor to process information in a top down analytical style. It’s quite a process seeing that one needs to start in the longer-term time frames and work forward into the smaller. It appears to me that the contract remains vulnerable to more sustained downside action. As in real estate ventures location…location…location becomes one of the key elements. The decline from the high made on December 5th seems impulsive to me. This ties into my assessment of the weekly price action from the lows seen in early January which I have deemed non-impulsive. Jumping onto the deep end is never recommended especially at a long term inflection point. One needs to be willing to miss a trade in favor of stacking the evidence in your favor. There are always plenty of trains leaving the station. In this instance I am in the process of stalking the trade. This is built on a series of if-then scenarios. That being said should a non-impulsive rebound play out from the recent low ,which I believe is what we’re witnessing, isolating a strike zone to execute is called for. Blending various geometric studies along with retracement levels point to a convergence zone resting overhead at +/-.78500. Currently I’d be suggesting a short position from here. My downside projection comes in at approximately at .7500. Above .79300 compromises this set-up. Measured risk/reward projects to a favorable 4 to 1.
My analytical breakdown focuses on a blend of wave pattern recognition, long and short term geometrical extensions and momentum signal interpretation.