How are you?

Was just about last year we were chatting and posting ideas as USDCAD went to it's lows. Just stopped by to say hi and send well wishes.

All The Best,
Yellowlion

I am doing well.

Good to hear from you.

Still trading?

This Market is testing Lows between last Thursday's .9982 and Friday's 1.0025 this Monday Morning July 21st. ... attempting to create a support zone for a possible move to the upside sometime this week. Even though we still have no defineable Trend ... keep in mind that a Bear Market makes it's Highs early in the week and a Bull Market makes it's Lows early in the week ... which is why sitting out Monday or Tuesday is often to a Trader's advantage. Monitoring the ceiling and floor of Daily Price Clouds will give an "early" clue as to which side the Break is most likely to occur and when ... which is why I am always drawing your attention (to keep in mind) the Weekly Opening Price.

Glad to hear you are well.

Yup, I'm still trading. Scalping EURUSD during London. Posting daily on another board. Things are just fine.

USDCAD is off the radar but if I pick it up again you know where I'll be... Right here.

All The Best,
Yellowlion

The USDCAD continues to remain above parity. Outside of the period when oil prices jumping sparked fears that consumer consumption in the U.S. would grind to a halt and sent the stock indexes falling it has held as support. Upcoming retail sales and CPI data is expected to be loonie bullish which could send the pair lower, but without a clean break below, we could see the beginning of a longer term bullish rally.

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Looks like the USD/CAD pair got lucky this morning, between Plosser's comments, lower than expected retail sales (Act: +0.4% vs. Exp: 0.5%), and the weakening of Hurricane Dolly. Additionally, CPR has dropped around 40% amid fuel costs -- the Loonie looks poised for a rough day.

Overall obligation leans to the downside this Week. Looking for the Low into Friday's close ... unless today (tues. 24th) breaks above 1.0084 only to initiate fresh secondary buying. Equilibrium is coming in at 1.0072 ... so a Short sale to the downside brings greater reward/risk if proven correct.

For those of you waiting for USDCAD to put in for some dramatic price action in the near term (which I do not believe it will see until 0.9750-1.0350 range falls), you should look at the loonie crosses.

CADJPY has been cutting a far more consistent range in an ascending wedge with a horizontal level of resistance on a big 38.2% fib at 107.15.

Far more interesting in my opinion though is AUDCAD. A bullish channel has been very strong with this pair, and the momentum has seen its first major ceiling (at around 0.9830/40) since it got underway at the beginning of this year.

This same resistance level held up to back in early 2005 as a level of resistance and now it has modest strength against an incredible trend. Going to be interesting to see how this plays out.

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ADU/CAD pair did not break that resistance which led to a formation of a cup and handle which might turn out to be a bearish one.

USDCAD has remained supportive despite the higher than expected inflation data. Headline prices rose to 3.1% which is above the BoC 's target band. However, core prices remained unchanged which is where the MPC usually lies its focus.That said I think my call of 1.02 by next week still looks good, especially if oil continues to retreat.

Wow, that surprise RBNZ rate cut certainly hammered the kiwi dollar. What initially looked like a potential hold a short-term rising trendline has instead turned into a major bear leg to push spot to new six-month lows.

With this move, we have a bevy of technical formations confirmed and broken. Most important in my book is the falling trend channel is clearly confirmed, new lows are being made and a major 50% fib was broken.

On the other hand, a relatively minor rising trendline from the October swing low is now being tested and a far more significant trend from the June '06 trend reversal is matching up to the bottom of the trendchannel down near 0.7250/70.

If we get a higher time frame close below 0.74 I may put in for a two lot short with the second half looking for a longer-term objective in an eventual break below 0.72. Of course that would rely on significant dollar strength (a difficult thing to have faith in given fundamentals); but short-term interest rates show forecasts of more than 100 points of easing from the RBNZ over the coming year which should help.

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If we are looking at the comm dollars, we also come across AUDUSD. Unlike the kiwi dollar, the Aussie currency is still backed by a strong economy and interest rates are still expected to lean to the hawkish side (expectations put 25bp of tightening over the coming year).

While a NZDUSD short would be going out on a limb for a strength from the US dollar against a major carry counterpart, going long on the major AUDUSD trendline would be be better aligned with the greater probabilities that the dollar is going to cap its gains until something more influential happens (the inevitable hike, surprise jump in GDP, etc).

On the other hand, this trendline (though marking five major reversal points in the pair's long uptrend) is somewhat messy.

Any other opinions on this pair - up or down?

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I think the drop in AUD/USD down toward 0.9550 presents a good opportunity to go long. Here we have a rising trendline that connects the January and June lows - not to mention the psychological importance of the level - and just below that the 61.8% fib of 0.9326-0.9849 at 0.9527. For the most part, my bullish bias stems from the fact the pair remains in a clear uptrend, and there's little reason to fight that. Also, on the 240 minute charts, MACD and RSI show that the bearish run from the recent highs may be running out of steam.

I unfortunately missed the big move down on this pair as my short limit was missed by 20 pips.
Now with a close under major resistance 0.7433 and more than likely bad data coming out tonight, I'm looking to enter a short.
short at 0.7437, SL 0.7470, one 0.7380 is hit I'll move stop to breakeven and re assess situation.

1 hr chart attached

Comments?

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