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Bahh! So much for that channel bounce!

USD/CAD barely made any headway upon testing the ascending channel support, and it now seems to be gunning for a breakdown.

In case you missed it, make sure you check out my initial trade idea first.

USD/CAD Trade Idea

A few days back, I spotted this neat ascending channel forming on the pair’s 1-hour chart and I thought I was already missing the bounce from support. I jumped in at

I jumped in at market (1.3375), thinking that there would be some upside momentum taking price back to the resistance at 1.3600 or at least until the previous highs.

However, the U.S. healthcare bill vote turned out to be a downer as it dampened hopes that the Trump administration could push its reform agenda without any roadblocks.

Because of that, dollar bulls retreated and kept USD/CAD in consolidation mode.

USD/CAD 1-hour Forex Chart
USD/CAD 1-hour Forex Chart

This week, crude oil inventory data showed smaller than expected gains in stockpiles, easing oversupply concerns and giving the commodity price a much-needed boost.

To top it off, news of armed protests disrupting oil production and shipments in Libya also put upward pressure on Black Crack as these would put a 250K dent in the OPEC member nation’s daily production.

To top it off, news of armed protests disrupting oil production and shipments in Libya also put upward pressure on Black Crack as these would put a 250K dent in the OPEC member nation’s daily production.

Since price is already moving below that ascending channel I’m looking at, it already validates my technical trade thesis so I’m getting out of this position to trim my losses.

I was kind of hoping that the recent Brexit happenings would bring more risk aversion and safe-haven dollar demand back to the table, but that wasn’t the case either. Here’s how my trade turned out:

I was kind of hoping that the recent Brexit happenings would bring more risk aversion and safe-haven dollar demand back to the table, but that wasn’t the case either. Here’s how my trade turned out:

P/L: -45 pips / -0.11%

Not so bad, eh?

In retrospect, I probably should’ve gone with my gut feel of waiting for this pair to test the longer-term range support closer to the 1.3100 handle before going long.

Instead of hopping in right at the middle of the range and just after a bounce off resistance. USD/CAD does love to move sideways after all.

Still, I’m gonna give myself a quick pat on the back for being quick about hopping out instead of waiting for price to hit my full stop loss.

Don’t forget to check out our risk disclosure if you’re trading this one, too!

Cheers,

Happy

This content is strictly for informational purposes only and does not constitute as investment advice. Trading any financial market involves risk. Please read our Risk Disclosure to make sure you understand the risks involved.