Want FULL ACCESS To
ROSS’ DAILY TRADE ROOM?
Simply Click The Get Started Button Right Now!
Transcript of Video
Click Here to receive an email alert when Ross posts a new daily video
I’m going to get started today on the US Dollar versus the Canadian Dollar [USDCAD]. First off, before I begin today’s analysis, if you haven’t had a chance to attend the live daily Trade Room, I’d like to take this chance to invite you to join me today in the Trade Room. I will cover the daily analysis, similar to what I do here in the videos, but in a little bit more detail. And you also have the opportunity to ask questions and get involved with the trade discussion. So, please join me during today’s live Trade Room.
Going back here to the US Dollar versus the Canadian Dollar [USDCAD], I’m starting on the Daily Chart. We can get a wider view of this currency pair. Of course over the past several weeks, we’ve seen the trend bar – the Forex Black Book trend bar at the very bottom of the chart – red. Gives us a bearish trend bias.
Now, over the past several weeks or past few weeks, we see since March 20. Back here on March 20, we began a fall that went from up here into the upper-1.1200s. 1.1280 or so to be the highest high, and a fall back down into the mid-1.0800s, capping down here at the bottom into the 1.0855-level or so. The orange-shaded area here in the middle of the chart. And bouncing back now into the purple-shaded area into the upper-1.0900s.
Over the past few days, and we’re going back into Friday of last week, we have been holding inside this purple-shaded area as an area of congestion. Resistance running near the top of that purple-shaded area into the 1.09080s. Follow the top of that purple-shaded area back. We see a period here of resistance and congestion. We go back to the left-hand side. We’re going back into March again, early March, where we see support. We go back here even into February. We see support and congestion. And then back here on the left-hand side, back into January, some resistance and congestion.
So, this purple-shaded area: clear area of decision, where buyers and sellers are exchanging hands. Sometimes the buyers are getting out and the sellers are taking control, or the sellers are getting out and the buyers are taking control, causing this zone of support and resistance. Right now, over the past few days, we’ve seen resistance here. Now, of course, we do have a chance to see a breakout. If we see the market push through 1.0985 or even the 1.1000-level, we’re likely looking for the continuation higher as it pushes back into the 1.1020 to 1.1050-level, up closer towards this yellow-shaded area.
I’ve taken Fibonacci from the highest high down to the current low on the chart. The .382 fib sit here at 1.1018. That’s a little bit higher than current market. And you could see some historical support along there, so that wouldn’t be too hard to see the market pushing about 18 to 20 pips higher into that level. Then, beyond that, of course we’re going into the 1.1050s, 1.1060s, and 1.1070s, where the 50% retracement level is and quite a bit more congestion and support and resistance lined up in that yellow-shaded area.
So, for the day today, this purple-shaded area will be our area of decision. If it holds within there, we’ll wait for the breakout. If it breaks out above 1.0985 or so, we look for the continuation higher. A turn back underneath the purple zone, we likely look for it to turn back down towards the orange-shaded area in the direction of the previous trend and the red trend bar for the Forex Black Book. Let’s go ahead and put a couple of arrows here on the chart. Of course as I mentioned, a breakout, open and close above 1.0985 or so, we look for it to continue to pressure higher, targeting back here towards the yellow-shaded area.
When I talk about a breakout, I’m often looking for an open and close above a level of resistance. Then, underneath the purple zone, if it turns around and goes back down, we’ll likely turn back down towards this orange-shaded area. Let’s go ahead and take that information down to the 4-Hour Chart. And as we get down here to the 4-Hour Chart, we see the Forex Black Book trend bar red again at the very bottom of the chart. As all the indicators pop back in here to the chart, you can see the purple-shaded area as that area of congestion over the past few days. A little bit of an attempt right now to breakout above the 1.0985, 1.0990-level. It’s attempting to do it. I say attempting because it hasn’t closed above it yet.
Now, this candle here did close above it, but what I’m typically looking for is an open and close. A clear single candle body open and close above a level, so I’m confident then that’s a breakout. If it doesn’t do that, we could see the turn right back underneath the purple-shaded area or into the purple-shaded area and a turn back around to go back down. Now, we have seen over the past four or five days. We didn’t get bank flow levels yesterday, on Monday, but the past previous levels from late last week we could see implying buyer support down here just right around the orange-shaded area, and then the market start moving back higher.
I was anticipating, but we never go them. Anticipating the bank flow levels to show just underneath the purple-shaded area yesterday. Maybe a little bit similar to what they were on Friday, but we never got them. So, we’ll continue to watch for new bank flow levels today. I anticipate, at this point, they’ll likely be just underneath the purple-shaded area unless we see some larger market movement between now and the bank flow release. But staying above the purple zone, 1.0985, over the next several hours with the candle body open and close above here, we will be expected to continue to pressure back higher. We’ll look at that in more detail during the Trade Room later on today. Of course a break back underneath 1.0950 and the bottom of the purple zone, we already know that it’s likely that we look for a push back down here towards the orange-shaded area.
Continuing to pressure higher now, above the 1.0990-level, we’re back into 1.1000. Above 1.1000, 1.1020 or so, and then back into the yellow-shaded area would be your opportunity. If this current four-hour candle opens and closes, if it closes here above the 1.0985-level, it may give you a higher expectation that it’s continuing to pressure higher. Provides a buying opportunity above the purple zone to target back to the yellow zone or higher. If it doesn’t, turns back underneath it, breaks underneath 1.0950, we look for selling opportunities and targets back down towards the orange-shaded area for the USDCAD today.
