USD/CAD Price Analysis: Day traders are waiting for bearish price action signals
|- USD/CAD stalls at a well-telegraped resistance area.
- There are few, if any, prospects of a high probability setup from a swing-trading point of view.
- Day-traders will take note of the potential for sideways channel trading opportunities between resistance and support.
USD/CAD has not been very forthcoming with its intentions during phases of consolidation and here we are again, with the weekly resistance and daily support sandwiching the outlook.
Unfortunately, this makes for treacherous swing-trading opportunities.
However, there could be potential on the day-trading side.
The following illustrates the price action and developments to date in a continuation of the following analysis that had predicted the upside breakout to where the market is now resisted:
USD/CAD Price Analysis: Bulls finally catching a break?
Monthly chart
There is more to go to the upside until a 38.2% Fibonacci retracement and resistance structure.
However, there will be shorter-term opportunities on the downside at this juncture first.
Weekly chart
The price has reached a 61.8% Fibonacci that meets structure.
This makes for a compelling case for a pullback to at least a 38.2% Fibonacci retracement level.
Barroom brawl
However, the price is now trapped between weekly resistance and daily support.
This leaves little to no prospect of a high probability and protected setup in either direction from a swing trading perspective. at least not one that will offer a favourable risk to reward from a 4-hour time frame.
Day-trading opportunities
On the other hand, on the hourly time frame, bears can watch for an impulse to the downside to clear the support.
Such an outcome will potentially offer a discount with a fade on rallies towards the 38.2% Fibo target.
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