USDCAD FOREX UPDATE http://www.netpicks.com/forex-update-usdcad/

I mentioned quite a bit of information about the Forex pair USDCAD recently

and I want to return to what I had talked about and update where we are

now on the trading chart.

The USD has been quite strong against the CAD and has presented some

magnificent long trade position profits. There has been some profit taking

opportunities as well as ways to get involved in the move.

This chart is from the previous recap and is simply where we left off and shows a scale out on momentum as

well as a zone that may provide resistance.

I am going to quote from the original walk through and compare what has

occurred.

"Is it possible that price will just ram through the resistance?

It certainly is but so is price stalling for time and then slamming back down.

Often times, being stuck in a range not only holds up capital but can also exhaust mental capital as well."

What happened is almost exactly what I had written earlier and in the end,

another entry into the trend presented itself.

CURRENT CHART

Breaking down this chart.

1. Is the low of the resistance zone that set up back in 2009

2. This is the high of the resistance zone and it's in between these two

areas that you can map out a plan for your next trade.

3. This candles becomes a minor swing point and becomes the low prior

to the move up into #2.

4. I've mentioned these before and these upthrusts can be classified as

failure tests of highs and present some shorting opportunities.

5. After price slams back down, this spring breaks the previous low and is

immediately bought up and broke resistance. Buying opportunity in a range in the context of an uptrend.

I mentioned as well that there was an opportunity to trade lower on the

chart where the bull flag is sitting. The problem was there was not a ton of room to the top of that swing and it

was skipped.

BULL FLAG

"This also can be a buying opportunity in a retracement except price structure

in terms of what was potential resistance, is just above. It works, but in my books it was a low probability

trade."

Looking again at number 5, there is plenty of room for the trade to run if you are tuned into that spring that

occurred that offered a trading entry.

SPRING INTO UPTREND

As those that shorted on the up thrust at #4 bail out, price is able to rocket upwards and shatter a high that held

since 2009.

It looks pretty simple, doesn't it?

Make it tempting to have traders short after a long run up. Trap them and force them to exit. Use their exits to help propel price through a long held resistance level.

What Does The Future Hold?

Anything can happen but it doesn't

hurt to have some ideas of what may occur and plan your next course of

action.

1. Price may retrace to test the high of the former resistance zone. 2. Price may fail back inside the zone although this does not negate the breakout. 3. Price may continue up into the next roadblock set back in 2004

This chart is from 2004 and shows the next chunk of price structure that we

will have to work through to push higher.

THE PRESENT MEETS THE PAST

Red line is where current price currently sits. Blue dotted is the former resistance zone.

Red circle is a short term range that broke down and price has returned. Yellow highlight is a pivot that was a retrace to the open of the momentum red.

We are not in a clear cut area if we just focus on the technical aspects of this

chart. For me, sitting on USDCAD longs, I will watch how price reacts to this area and would love to see it play

out

as the arrows show. Breaking above this area, the next area that I'd be

interested in seeing is between 1.36-1.38.

Will it play out that way I have laid it out? Maybe not but the key is being

prepared and not just reacting to what price does.

This type of Forex update or for any other market is something that I think will benefit most traders. Keeping a journal of your trades and ideas and then referring back to them is a great way to see how you have improved in

your trade analysis.

It also ensures that you are aware of the possibilities that may occur and

are ready to take advantage of whatever comes your way. Being

prepared is the hallmark of a professional. Be one.