AUDCAD DOUBLE SCENARIO IN PLAY
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AUDCAD has been trending lower for the past five months. This lower trend has carved out a bearish channel and the last couple of weeks has seen the pair bouncing off the lower band of the bearish channel.
This has carved out a double bottom yet to be confirmed.. This however has given as two scenarios on how to approach AUDCAD.
The first scenario is for us to play the reversal card with the double bottom formation.. However, for the pattern to be complete the bulls has to close above 0.906. The 0.906 is critical as its acting as a confluence of resistance( meeting point of upper band of the bearish channel and the horizontal level) if breached could take the pair to higher levels around 0.9247.. we want confirmation so we place BUY STOP @ 0.9066
The second scenario is to play the bearish continuation card..Here we look for bearish price action at the confluence point to sell the pair to its next leg lower... Importantly, yesterdays price action hits the confluence point and closed lower but not as low as the previous candle ... we prefer to place a SELL STOP @ 0.898 with TP@ 0.882.
We therefore wait and monitor the developments of AUDCAD to see which scenario wins.
This has carved out a double bottom yet to be confirmed.. This however has given as two scenarios on how to approach AUDCAD.
The first scenario is for us to play the reversal card with the double bottom formation.. However, for the pattern to be complete the bulls has to close above 0.906. The 0.906 is critical as its acting as a confluence of resistance( meeting point of upper band of the bearish channel and the horizontal level) if breached could take the pair to higher levels around 0.9247.. we want confirmation so we place BUY STOP @ 0.9066
The second scenario is to play the bearish continuation card..Here we look for bearish price action at the confluence point to sell the pair to its next leg lower... Importantly, yesterdays price action hits the confluence point and closed lower but not as low as the previous candle ... we prefer to place a SELL STOP @ 0.898 with TP@ 0.882.
We therefore wait and monitor the developments of AUDCAD to see which scenario wins.
Trade attivo
trade triggered @ the buy side @ 0.9066
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