Welcome to mid-week trading, forex friends!
We’re all about CAD today as we explore AUD/CAD’s downtrend and EUR/CAD’s range opportunity.
What do you think of these setups?
AUD/CAD is seeing a textbook case of lower highs and lower lows! The pair has been trading in a downtrend since the 100 SMA crossed below the 200 SMA earlier this month.
AUD bears have another chance to flex as AUD/CAD hangs out at the .8950 minor psychological level near the top of the 1-hour chart’s descending channel resistance.
And if that’s not bearish enough for ya, check out the divergence formed if you consider Stochastic’s higher highs!
Shorting at current levels of the first signs of bearish momentum would yield a good risk ratio if AUD/CAD dips back to its June lows.
If you start to see AUD/CAD consistently trade above the channel and the 100 SMA, though, then you gotta be ready to trade a potential breakout and a short-term reversal!
Where my range-trading brothas at?
EUR/CAD is having trouble breaking the 1.3530 range resistance level that EUR bulls haven’t breached since the start of the month.
It doesn’t help that Stochastic is already flirting with overbought levels and that the 100 and 200 simple moving averages are juuust above current prices.
Think the range will hold for another day?
A rejection at 1.3530 could drag EUR/CAD back down to the 1.3460 mid-range levels if not the 1.3400 range support zone.
A breakout above the range and the SMAs, on the other hand, could push the euro back up to the 1.3650 or 1.3700 previous areas of interest.