26.07.201310:59 Forex Analysis & Reviews: USD/CAD analysis for July 26, 2013

Long-term review

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USD/CAD Elliott Wave
Since our last analysis the USD/CAD pair has made a new low, so we need to consider the final wave 5 (coloured blue) of the (A) wave as incomplete. Yesterday, during the Asian and European sessions we could observe descending movement from 1.0312 towards the 1.0254 level and we can consider this move as the end of the wave (A) (coloured green). Therfore, during the New York session this currency did not manage to hold around the lows and price has retraced back to 1.0289 level. At the moment the USD/CAD pair is trading around 1.0276 level, and if price manages to stay above 1.0254 we can expect to see the price higher for the (B) wave end. In accordance with our wave rules and taking into account that wave B should retrace 61.8% of wave A, so we can define the potential targets with measuring wave A with take profit at 1.0471 (61.8% of wave A). To reduce the risk, we can use invalidation point at 1.0254 level as stop loss.

Alternate Count: Corrective wave (A) is not yet completed, and we could see one more push lower before price turn around when development of the (B) wave starts.

Support and Resistance
(S3) 1.0185 (S2) 1.0219 (S1) 1.0249 (PP) 1.0283 (R1) 1.0313 (R2) 1.0347 (R3) 1.0377

Trading forecast
Proceeding from Elliott Wave rules today, the trend is expected to begin the upwards movement. That is why long positions at level 1.0330 with stop loss at 1.0254 and take profit at 1.0471 are recommended.

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