Hi Traders! EURCAD short term forecast update and follow up is here. On January 31st 2023 I shared this “EURCAD Technical Analysis And Short Term Forecast” post in our blog. In this post, let’s do a recap of this setup and see how it has developed now. If you would like to learn more about the way we trade and the technical analysis we use then check out the Home Trader Club. Spoiler alert – free memberships are available!
My Idea
On the H1 chart, the price which is moving lower has created a bearish trend pattern in the form of three lower highs, and lower lows which we may consider as evidence of bearish pressure. Generally, after a bearish trend pattern, we may expect corrections and then a further continuation lower. Currently, it looks like a correction is happening. Also, we had two strong support zones that have formed and the price which was moving lower has broken below these zones and is holding below them, we may consider this as yet another evidence of bearish pressure. Currently, these strong support zones are acting as strong resistance zones for us. Until these two strong resistance zones (marked in red) shown in the image below hold, my short-term view remains bearish here. A valid breakout below the most recent uptrend line would be the validation for this short-term bearish view.
EURCAD H1(1 Hour) Chart Current Scenario
In this pair my short-term view was bearish and I was expecting the price to move lower further until the two strong resistance zones hold. Also, I mentioned that “A valid breakout below the most recent uptrend line would be the validation for this bearish view”. The price action followed my analysis exactly as I expected it to here. After the bearish trend pattern, the price which was moving higher reached the first strong resistance zone, respected it and then it bounced lower from this zone. Also, the validation for the bearish view which is a valid breakout below the most recent uptrend line happened as per the plan. The price then moved lower further and delivered around 100 pips move to the downside as you can see in the image below.
The price then moved higher, reached the second strong resistance zone, respected it and then it bounced lower from this zone, delivering 400+ pips move!
So traders when it comes to trading, there are various important factors that we need to pay attention to, just because we have a good setup doesn’t mean that we can enter the trade randomly and it will pay us huge profits. First of all, we need to validate the entry and we should have a perfect entry plan to get into the trade which is a key factor when it comes to trading. This EURCAD short-term forecast is yet another good example of this scenario.
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Arvinth Akash
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