Looks like we’re seeing more bearish Loonie action on these pairs I’ve had on my watch list! I actually hopped in one and I’m still on the fence with the other.
Short CAD/JPY Trade
After spotting this rising wedge breakdown earlier this month, I just decided to follow my gut and short at market. I was a bit late to the move, though, as I got in below the 87.00 mark.
The reason I waited a bit longer was that I wanted to see a break below the small head and shoulders pattern as well. This gave me additional confirmation (and confidence!) that sellers are gaining the upper hand.
I’ve got a wide stop above the 90.00 major psychological resistance to give this trade some leeway, but I’m hoping I can trail it lower to entry or slightly below that in order to lock in some pips.
I’m a bit worried, though, that risk appetite is slowly making its way back in the markets this week. This could be bullish for commodities and the oil-related Loonie while weighing on the lower-yielding yen.
If so, I’m keeping my fingers crossed that a pickup in risk would result in a mere pullback before a longer-term downtrend takes hold!
Long AUD/CAD Idea
Here’s another neat short CAD setup… that I chickened out of taking! But I’m not too late if I do decide to hop in, right?
You see, I thought price was already making a break below the channel support as it dipped below the 61.8% Fib. However, the Aussie staged a pretty decent rebound on Monday to create a small double bottom at the channel support.Stochastic is on the move up as well, confirming that bullish momentum is present. I think I’ll wait for a break past the double bottom neckline before going on a long position and risk a smaller part of my account than usual, especially since this is correlated to my short CAD/JPY play.
That’s all I got for now, folks. And in case y’all missed it, check out my latest updates on The Happy Hunter Trading System!
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