Trading The Canadian Dollar’s Next Big Move
This week we are looking for a fresh opportunity on USD/CAD, a fantastic breakout opportunity has presented itself to us and we would like to share this with you. The Loonie is on the verge of a big move and we are looking to fill you in on how Platinum approaches this type of opportunity.
THE CANADIAN DOLLAR: WHAT EVERY FOREX TRADER NEEDS TO KNOW
FUNDAMENTAL POINT OF VIEW ON CAD:
Inflation report: Friday, 13:30.
This is a key event for the CAD each month as inflation figures are critical for indicating an economy’s health. Therefore, it is important to look at each month: This is the most important inflation-related release due to its earliness and broad scope. This is among the few non-seasonally adjusted numbers reported on the calendar, as it’s the calculation most commonly reported.
Let’s take a look at what happened previously in this event:
Inflation surprised to the downside in March, with headline CPI advancing by 0.3% and Core CPI by 0.2%. The other measures of price development were OK with Common CPI up by 1.9% y/y, the Median CPI at 2.1%, and Trimmed CPI at 2%. Similar figures are likely for April.
Retail Sales: Friday, 13:30.
The Retail sales measures the change in the total value of sales at the retail level, excluding automobiles. Automobiles actually account for around 20% of retail sales but these figures tend to be more volatile therefore are excluded in the overall figure of retail sales.
Competing with the inflation report, retail sales lag and are for the month of March this time. Back in February, Retail Sales rose by 0.4% m/m while core sales remained flat. Better data is on the cards now.
With no Major fundamentals such as FOMC or NFP Market, we are safe to rely on technical this week and have a strong bias towards the technical charting.
TECHNICAL POINT OF VIEW ON THE USD/CAD
From the daily chart, we can see the recent result of the inverse head and shoulders pattern. We are now also in an ascending triangle pattern. Bias now is for Bulls and a breakout of the recent supply level is the trade to take. We have an opportunity to join the flow of the trade and enter on the pullback @ 1.2845. the long-term momentum is still Bullish and that’s where Platinum traders will be trading.
USD/CAD FOREX TRADING STRATEGY
Trade Entry: Long USD/CAD @ 1.2845 with a 40 pip stop loss with an initial target of 1.3075 and a secondary target of 1.3300
KEY TECHNICAL LEVELS ON THE USD/CAD
- 2700 – Long-term Buying Level
- 2600 – Long-term Buying level
- 2500 – Long-Term Buying Level
- 2055 – Long-term Buying Level
How to become a profitable Trader.
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Hopefully, you have enjoyed today’s article and have gained great knowledge about trading opportunities and how to trade.
See you soon!
The Platinum Formula:
Perfect Fundamentals + Perfect Technical Analysis + Perfect Logic + Perfect Risk Management = Perfect Trade
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Have a fantastic day!
Live from the Platinum Trading Floor.
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