EURCAD – Daily. Strategy Update

  • I posted details of a Gartley sell set up in this currency pair on 19 October.
  • Under this strategy you would have sold at around 1.4190 on 26 October and would still be short
  • After yesterday’s candle there is now an opportunity to move the stop down to 1.3908. I have outlined the logic for this below

 

As traders we aim to have positions in those trends that move quickly and/or last a long time ( longer and stronger). Trends that overlap through previous support/resistance levels tend to be weak and corrective. Overlapping is also a sign of potential reversal

EURCAD made a corrective upswing between 12th and 19th November and the larger downtrend then resumed taking out the recent low yesterday. If the downtrend is to stay impulsive, it shouldn’t overlap back through that low.

The overlap point is now becomes the nearest failure point for the trade and so an appropriate place to have the stop. Allowing a bit of tolerance to be sure of overlap has definitely occured, the stop could be placed just behind the dashed red horizontal line at 1.3908

Cheers

Ric

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