Welcome to our newest feature; DecaPip. The concept is simple: our professional market technician, with an exceptional system, showcases his own daily Support and Resistance levels across a broad spectrum of FX currency pairs. The most effective way to use the levels are:
- If indicated levels hold, look for the price to reverse.
- If levels are broken, look for the price to continue past to new highs or lows.
For the Non farm payroll Friday edition of DecaPip Daily I would like to take a look for a possible swing trade in USDCAD.
If the currently top located around 1.3210 that was made on Wednesday can hold today and we can get a decent pullback trade to enter short it could be a great trade.
The chart below gives a bigger picture overview of the recent daily action in this fast moving highly Oil correlated currency pair.
We can clearly see the huge reversal candle on the chart and rest assured traders will be waiting and watching to see if they can enter short any good retrace should the chance present itself.
As always with any swing trade selection finding highly accurate and relevant levels to enter the move is paramount.Keeping the stop loss as small as possible whilst leaving yourself some breathing room for the market to do it’s thing is also crucial and requires a good deal of pre- planning.
My trade idea here would be to look for a move back to the 1.3170 area after the news release if we do did get a pullback and price stalled in our trade selection area.Place a well thought out stop loss above the recent high made Wednesday with a risk reward ratio of no less than twice our stop loss.
If we do get some overshoot to the upside today myself and the Trendline analysis team at LittlefishFX have the 1.3275-1.3300 as a possible extension area to watch should we take out the newly made weekly high.
Another idea for the risk averse would be to wait for the news today to settle into the market and wait until Monday to enter and assess any possible trade set up in this pair as this is rather a risky trade considering the very bullish nature of USDCAD since 2014.
Got any questions about our new DecaPip feature? Contact Nathan at Nathan@littlefishfx.com
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