The corrective move from 1.206, wave 4 low, still lingers. Our bearish bias is still intact unless there is a fast move upside. A corrective pattern is just about to complete before USDCAD takes the last bearish leg. Check the 14 September USDCAD Elliott wave analysis and trade setup below for clues.
In the last update, we discussed about price completing the last bearish leg toward 1.18-1.19 region. At the moment, the 4th sub-wave is still in motion. It’s important to wait for this correction to complete and wait for price to make moves favorable in the direction of our expectation. The chart below was used.
The chart above shows that price could still dip below 1.2 to probably 1.19-1.18 region. How price reacts at this zone will speak volume of a bullish correction or resurrection. Unless a strong rally is seen above 1.24, price is expected to dig to 1.18-1.19 region before the bullish move.
The end of the 4th sub-wave (in blue) could be the trigger for another bearish opportunity to 1.18-1.19 region. A closer look at this wave, we have the chart below.
The chart above shows an emerging double zigzag pattern. 1.2256-1.2290 is the set reversal zone. If price gets to this zone and breaks below the trendline as shown above, there is high likelihood for price to return downside. If price is short of reaching this zone before breaking below the trendline, it is important to wait for a break below 1.2130 for a good entry price. Targets are 1.2, 1.19 and 1.18.
A break above 1.2256-2290 region could be an indication that the bullish correction has resumed or a new wave analysis is required.
Let’s know your thoughts by your comments in the box below.