Currently writing from the sunny Dubai. Hopefully you are all doing great so far this week! USDCAD got my attention today with a potential setup to the downside. Let me share my point of view:
H4 – we came all the way to the KEY monthly area of the resistance. Price after a huge rally to the upside is now showing clear exhaustion signs right at the key monthly level. EMA’s are quite wide as well which indicates that the market moved quite aggressively and a correction is needed.
H1 – nice upside channel formed. A clear breakout of the channel and below EMA’s would confirm my potential entry opportunity. DXY (US Dollar index) showing bearish sentiment as well, so keeping this in mind it makes this potential short even stronger. Keep in mind that a break and close (H4 and higher) above key monthly level would invalid this short setup!
Wishing you a great week!
Matt from TechnicalFX