Trade Idea: USD/CAD – Hold short entered at 1.3500

USD/CAD – 1.3508

 
Recent wave: Only wave v of c has ended at 0.9407 and wave C of major A-B-C correction is underway for headway to 1.4700

Trend:  Near term up

 
Original strategy       :

Sold at 1.3500, Target: 1.3330, Stop: 1.3560

Position: – Short at 1.3500

Target:  – 1.3330

Stop: – 1.3560

 
New strategy             :

Hold short entered at 1.3500, Target: 1.3330, Stop: 1.3560

Position: – Short at 1.3500

Target:  – 1.3330

Stop:- 1.3560

Although the greenback rebounded after finding support at 1.3426 and further consolidation would be seen, reckon resistance at 1.3547 would hold and bring retreat later, below said support at 1.3426 would signal the rebound from 1.3387 has ended and bring retest of this level, break there would extend the fall from 1.3794 top for further weakness to 1.3350, then towards 1.3300, however, loss of near term downward momentum should prevent sharp fall below 1.3250-60.

In view of this, we are holding on to our short position entered at 1.3500. Above said resistance at 1.3547 would abort and prolong consolidation, risk rebound to 1.3571-79 (previous support and 50% Fibonacci retracement of 1.3770-1.3387), however, reckon upside would be limited to 1.3620-25 (61.8% Fibonacci retracement) and bring another decline later. 

To recap, wave B from 1.3066 is unfolding as an a-b-c and is sub-divided as a: 1.2192, b: 1.2716 and wave c is a 5-waver with i: 1.1983, ii: 1.2506, extended wave iii with minor iii at 1.0206, wave iv ended at 1.0781 and wave v as well as wave iii has ended at 0.9931, hence the subsequent choppy trading is the wave iv which is unfolding as (a)-(b)-(c) with (a) leg of iv ended at 1.0854, followed by (b) leg at 1.0108 and (c) leg as well as the wave iv ended at 1.0674. The wave v is sub-divided by minor wave (i): 0.9980, (ii): 1.0374, (iii): 0.9446, (iv): 0.9913 and (v) as well as v has possibly ended at 0.9407, therefore, consolidation with upside bias is seen for major correction, indicated target at 1.3700 and 1.4000 had been met and further gain to 1.4700 would be seen later.