USDCAD - Parabolic move leads to the cascading effect

2020년 10월 13일

USDCAD
The parabolic move was started on Starting of the September month and ended in September month end. The instability in oil prices caused the Lonnie to lose some ground against greeenback.

But after the shift in positive sentiment in the market CAD has gained some
ground against USD. After the ABCDE Elliot correction waves formed at the end of previous month its started fall towards 1.31000 key psychological level.

We can clearly see the series of consolidation phases and the rapid distribution phases as the consolidation phases slowly expired the Distribution phases which is abrupt rise and fall in the prices.

We can see a cascading effect happened around 1.33400 level and felled towards 1.31000 which is almost 240 pips fall in a week which is a 2% Drop.

In Elliot wave theory the 3rd major impulse wave was completed and the minor 4th wave is also completed and the 5th wave is underway. We can calculate the length of upcoming 5th wave by merely measure the length of the 1st wave which is around 200 pips.

The price is facing a minor hurdle at 1.31000 key psychological level and trading within a 40 pips range we can expect downward play. From this consolidation range and the next drop would be equal to the 200 pips move which is similar to the 1st downward Elliot impulse move.

In One hour timeframe the Ichimoku cloud is acting as resistance and 50 Exponential moving average is acting as decent support for the bear And the Bollinger band is narrowing we can expect breakout in coming days. In MACD the histogram is about to turn red and may fall below the middle line .And the oscillators are still pointing upwards and. Relative strength index is at neutral region.

In four hour timeframe the Relative strength index is reached the oversold territory and In MACD the histogram is turned green and crossed the middle line and the oscillators are about to cross.200 Exponential moving average is floating around 1.32100 which will act as next upside barrier for the bull. And 50,100 Exponential moving averages are make golden cross.

In daily timeframe USDCAD is reached the lower region of Bollinger band if the Today candle is closed above 1.31200 level then it will leave us a bullish engulfing pattern in daily timeframe. Ichimoku cloud is turned green but the cloud is still acting as resistance for the bull. The Relative strength index is at 37 level which is just above the oversold territory. MACD is still in red and the oscillators are still pointing towards south


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