EURCAD | Perspective for the new weekMy perspective on this pair is going to be the opposite of the majority in the market as my research reveals that the big wigs are doubling down their position against the new week. Technically, with the strong support @ C$1.415 area; I foresee a short term gain for the Euro which might be a retracement of the overall bearish momentum or a possible move for an outright north in the coming weeks.
Tendency: Uptrend (Bullish)
Structure: Supply & Demand | Reversal pattern (Double Bottom)
Observation: i. It has been a Bearish run for the Euro since mid-September 2021 where the CAD recorded a 6.20% growth in the last 4 months.
ii. I am of the opinion that prices have found a bottom. Why? Well, since the price touched the C$1.451 area in November 2021, we have witnessed multiple strong rejections depicting buying power from this area.
iii. The highest point buyers have moved the price from the demand level is C$1.46 area (over 400pips move); this feat is recorded on the 20th of December 2021.
iv. Immediately price touched C$1.46, a downward spiral occurred which evolve into a Double bottom pattern within the same demand zone (during the previous week trading session) which based on past experience I have considered a strong area for the buyers.
v. Double Bottom: The appearance of this reversal pattern at this juncture in the market describes a possible change in trend and a momentum reversal from prior leading price action.
vi. In this regard, a breakout/retest of key level @ C$1.43 (neckline) will be a comfortable area for us to open a long position on this trade in the coming week(s).
NB: It is appropriate to state here that this is a counter-trend trade hence the need to be highly alert during the course of the trade as any bearish momentum could send the price crashing. .. Trade consciously!😊
Trading plan: BUY confirmation with a minimum potential profit of 350 pips.
Risk/Reward : 1:4
Potential Duration: 10 to 15days
NB: This speculation might be considered to make individual decisions on the lower timeframe.
Watch this space for updates as price action is been monitored.
Risk Disclaimer:
Margin trading in the foreign exchange market (including commodity trading, CFDs, stocks etc.) has a high risk and is not suitable for all investors. The content of this speculation (including all data) is organized and published by me for the sole purpose of education and assistance in making independent investment decisions. All information herein is for your reference only and I take no responsibility.
You are hereby advised to carefully consider your investment experience, financial situation, investment objective, risk tolerance level, and consult your independent financial adviser as to the suitability of your situation prior to making any investment.
I do not guarantee its accuracy and is not liable for any loss or damage which may result directly or indirectly from such content or the receipt of any instruction or notification therewith.
Past performance is not necessarily indicative of future results.
