Hi Traders! Today I am sharing with you the AUDCAD technical analysis and forecast post. The way I would like to analyze the chart for setups is based on multi-timeframe confirmations because in my POV if we get more evidences on different timeframes for the same direction then it makes the setup much more reliable. We do our analysis on the MetaTrader4 platform (MT4), some very interesting, useful tips and hacks about the MT4 platform could be found here. If you would like to learn more about the way we trade and the technical analysis we use then check out the Traders Academy Club Spoiler alert – free memberships are available! Now, let’s start our analysis from the highest timeframe which will be the daily chart here.
You can watch the video explanation of this idea here
On the daily chart we have a strong support zone that has formed around 0.9250 level. In addition to this while measuring the first wave using the Fibonacci expansion tool we could see that the 100%(0.92529) Fibonacci expansion level coincides in the same area which makes this a key support zone. The price which was moving lower reached this key support zone, respected it and is currently bouncing higher from this zone. Also based on the Parabolic Sar we could see that the dots are below the price which we may consider as evidence of bullish pressure and currently there are no signs opposing this bullish view. We may now move down to lower timeframe and see if we can find evidences supporting this bullish view.
On the H4 chart the price which is moving lower has created multiple false breaks which we may consider as evidence of bullish pressure. The price has also created multiple bullish divergences between the first low that has formed at 0.93380 and the second low that has formed at 0.92605 based on the MACD indicator which we may consider as another evidence of bullish pressure. The price then moved higher and broke above the last high at 0.93708 which we may consider as another evidence of bullish pressure. Also based on the Parabolic Sar we could see that the dots are below the price here as well which we may consider as yet another evidence of bullish pressure. So the bottom line here is that the H4 chart has evidences supporting the bullish view and we may now move down to one more timeframe lower and check for evidences supporting the bullish view.
On the H1 chat the price which is moving higher has created a bullish trend pattern in the form of three higher highs, higher lows, we may consider this as evidence of bullish pressure. Generally, after a bullish trend pattern, we may expect corrections and then potential continuation higher. Currently, it looks like a correction is happening and while measuring the first wave using the Fibonacci expansion tool we have two key support zones that has formed around the 100%(0.93397) Fibonacci expansion level and the 161.8%(0.92161) Fibonacci expansion level. Until both these key support zones hold my view remains bullish here and I expect the price to move higher further. Alternatively if the price moves lower and if we get a valid breakout below the low at 0.92605 then this bullish view will be invalidated.
AUDCAD D1(Daily) Chart Analysis
AUDCAD H4(4 Hours) Chart Analysis
AUDCAD H1(1 Hour) Chart Analysis
It is always recommended to look for confirmations before you jump into any trade. If you are not sure about how to trade this buy setup then you can use any setup and strategy that you have in your arsenal to look for bullish moves and join this buy trade.
Also, don’t forget to protect your buy trade using a stop loss and make sure to set a target and keep a proper risk/reward ratio.
You will also find a pretty extensive database of educational materials here in the blog – just use the search or check out the Forex Education section above.
Not sure how to enter a trade? Spot reversals (bounces)? Not sure how to spot breakouts?
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If you have any further questions, don’t hesitate to drop a comment below!
To your success,
Vladimir Ribakov
Certified Financial Technician
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