USDCAD: Bulls setting up good context for swing buy
The USDCAD has a bear spike in Jan, followed by a broad bear channel. The bear channel ended in a strong bear spike down on 2/3, and then found strong buying. There were probably bears who sold closes near the 1.37 low, so the market would probably test down there (STC Test).
It did this week, forming a double bottom. The final leg down was weak and looks like a bear leg in a trading range, not in a bear trend. The final bear flag was a triangle with two bars above the EMA.
The context for the bulls looks strong but they have not created a strong breakout, so the odds of a reversal up are prob 50-60%. If there is a bull spike with consecutive bull bars, the odds will be much greater.
The one problem for the bulls is that the broader trend line (maroon, thick, lower right corner) may have to be tested first.
Bull targets: 1.4 (higher high) and 1.43 (test of start of bear channel)
It did this week, forming a double bottom. The final leg down was weak and looks like a bear leg in a trading range, not in a bear trend. The final bear flag was a triangle with two bars above the EMA.
The context for the bulls looks strong but they have not created a strong breakout, so the odds of a reversal up are prob 50-60%. If there is a bull spike with consecutive bull bars, the odds will be much greater.
The one problem for the bulls is that the broader trend line (maroon, thick, lower right corner) may have to be tested first.
Bull targets: 1.4 (higher high) and 1.43 (test of start of bear channel)
The scalpers exited on the Low 2 and will buy a strong reversal and/or bull breakout.
In the past few days, the market made a small HL and LH, which is a triangle. The market is in breakout mode, and the bears will probably have a small move down that will reverse up.