USD/CAD – 1.2456
Original strategy :
Bought at 1.2285, met target at 1.2450
Position: – Long at 1.2285
Target: – 1.2450
New strategy :
Buy at 1.2360, Target: 1.2560, Stop: 1.2300
As the greenback surged again after finding renewed buying interest at 1.2329 and reached our indicated upside targets at 1.2450 (our long position entered at 1.2285 made 165 points profit), adding credence to our view that low has been formed at 1.2061 and mild upside bias remains for this move to bring retracement of early selloff to 1.2525-30, then towards 1.2590-00, however, near term overbought condition should limit upside and reckon resistance at 1.2663 would remain intact.
As we have taken profit on our long position entered at 1.2285, would not chase this rise here and would be prudent to buy again on pullback as 1.2360-70 should limit downside. Below indicated support at 1.2313 would defer and risk weakness to 1.2254 support (Friday’s low) but only break of latter level would signal top is possibly formed, bring test of previous support at 1.2197, below this level would confirm and bring weakness to 1.2160-65, then towards support at 1.2121, break there would confirm the rebound from 1.2061 has ended and bring retest of this level later, We are keeping our count that wave v as well as wave (C) ended at 1.3794 and impulsive wave (i ii, i ii) is now unfolding with minor wave iii ended at 1.2414, followed by wave iv correction ended at 1.2778, wave v has reached our indicated downside target at 1.2100 and may extend to 1.2000.
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.