- November 8, 2022
- Posted by: Tradingshot Articles
- Category: Forex
The EURCAD pair couldn’t have traded better our September 19 set-up as the price broke above the 1 year Channel Down and broke above the 1D MA200 (orange trend-line) for the first time since Feb 07 2022, but got rejected on the 1.37150 Resistance:
This Resistance rejection pattern has taken place another two times since September 2021 and until we break above 1.37150, we have to be careful of a bearish break-out. For now the 1D MA100 (green trend-line) is supporting but the slightest break below it, can hit the 1.2870 Support and further break the -0.382 Fibonacci extension (1.25500) as the previous Resistance rejections did.
A 1D candle close above the 1.37150 Resistance though, would constitute a complete shift to the long-term trend to bullish and target the upper Fibonacci retracement levels (light blue), which as you see match almost perfectly the Lower Highs of the former Channel Down.
It is also interesting to observe the RSI on the 1W time-frame. It is struggling to break above its 1 year Resistance and as long as it does, the pattern shows a drop to the Support Zone. If it breaks above the Resistance though, it would also be a long-term bullish confirmation.