Today we will talk about AUDCAD, which I think may present us a wonderful buy opportunity. There is an up-move trend line as plotted on the daily chart shown below. The pair may stop around this trend line and start to move up again. So, we would be looking to buy AUDCAD around this trend line.
As seen on the 4 hour chart, there are two support level just around the trend line from where we may look to buy AUDCAD. If the pair drops a bit lower, make a stop at around 0.9540 or 0.9520 and create a bullish hidden divergence on the 4 hour chart, then we will enter a buy trade for AUDCAD.
Alternatively, if the pair does not drop lower and move up, then we need the pair to break the down-move trend line as plotted on the 1 hour chart shown below. If AUDCAD breaks above the trend line and resistance, and close above it, then we will jump into a buy trade. Initial target should be around the next down-move trend line on the 4 hour chart as shown above and final target could be the previous high of 0.9740. Stop should be placed below the trend line in the first case and below the broken resistance in the second case.
Reviewing Friday’s events and trades
USD weakened across the board going into the weekend last week, and lost heavily against Euro, GBP, CHF and JPY. Michigan Consumer sentiment missed the expectations and declined to 77.5. Personal spending and Income data was around expectations, but failed to help the US dollar. GBPUSD was one of the biggest gainers, which traded above 1.6150. USDCHF fell sharply to around 0.9025, and EURUSD broke higher to trade as high as 1.3162.
Fundamental Outlook for the day
Week opened with some gaps in Euro crosses as the political concerns in Italy increased. EURUSD traded at lows around 1.3475 and EURJPY at 131.70. Earlier in the Asian session, Chinese HSBC manufacturing index fell to 50.2 from the previous reading of 51.2, which is acting as a dent for the risk pairs. Today, we have Eurozone inflation data, Canadian GDP data and Chicago PMI. Later in the next Asian session, Chinese manufacturing PMI and Australia’s Retail sales data is also scheduled. Market may get volatile as the week progress because we have NFP on the Friday. So, trade carefully and do not try to chase any breaks.
This analysis is taken from today’s Daily Market Forecast, which also includes trade opportunities on: NZDJPY, AUDNZD, EURGBP, DOW JONES and USDTRY.
Get it HERE: Vladimir’s Markets Forecast
Have a Green week friends. Happy trading!
