Analysis:
The USDCAD daily chart shows a textbook completion of an Elliott Wave 12345 sequence. Wave (5) has just completed, supported by clear bullish divergence on the Awesome Oscillator (AO) – a classic signal suggesting exhaustion of bearish momentum.
What strengthens the bullish reversal bias is the presence of a bullish engulfing candle at the end of Wave (5), right at a key structural low. This candle formation, combined with the divergence, provides strong evidence that a corrective wave (likely Wave A or a larger reversal) may be underway.
🔍 Key Confluences:
Wave 5 ends in a falling wedge structure.
AO shows higher low on Wave 5 compared to Wave 3 → Bullish Divergence.
Bullish engulfing candle confirms momentum shift.
Price action breaking out of the wedge pattern.
🎯 Trade Plan:
I am waiting for a pullback toward the breakout zone to find an optimal buy entry. The ideal entry would be a retest of the bullish engulfing candle low or broken wedge resistance, turning into support.
📈 Targets:
Initial short-term target: ~1.3850 (previous Wave 4 region).
Mid-term potential: ~1.4050 depending on structure development.
🛑 Invalidation:
A daily candle closing back below the low of the bullish engulfing will invalidate the bullish outlook.
The USDCAD daily chart shows a textbook completion of an Elliott Wave 12345 sequence. Wave (5) has just completed, supported by clear bullish divergence on the Awesome Oscillator (AO) – a classic signal suggesting exhaustion of bearish momentum.
What strengthens the bullish reversal bias is the presence of a bullish engulfing candle at the end of Wave (5), right at a key structural low. This candle formation, combined with the divergence, provides strong evidence that a corrective wave (likely Wave A or a larger reversal) may be underway.
🔍 Key Confluences:
Wave 5 ends in a falling wedge structure.
AO shows higher low on Wave 5 compared to Wave 3 → Bullish Divergence.
Bullish engulfing candle confirms momentum shift.
Price action breaking out of the wedge pattern.
🎯 Trade Plan:
I am waiting for a pullback toward the breakout zone to find an optimal buy entry. The ideal entry would be a retest of the bullish engulfing candle low or broken wedge resistance, turning into support.
📈 Targets:
Initial short-term target: ~1.3850 (previous Wave 4 region).
Mid-term potential: ~1.4050 depending on structure development.
🛑 Invalidation:
A daily candle closing back below the low of the bullish engulfing will invalidate the bullish outlook.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.