The bullish sentiment that still dominates the Dollar makes USD/CAD move higher. Therefore, the trading scenario this time will take advantage of the buying momentum.

Hi fellow traders! USD/CAD has regained strength yesterday (7/December). When this analysis is written, the price is still trying to continue the rally since bullish sentiment is still dominating the greenback. That's why buying momentum on USD/CAD may be the best scenario you can try.

usdcad

 

Analysis and Recommendation

Let's take a look at the following USD/CAD H1 chart below: 

usd cad 2

Based on the H1 chart above, it has been pointed out that USD/CAD is currently trying to climb to the supply zone in 1.3717 – 1.3763. Due to the dominant bullish sentiment, you can focus to look for ideal long opportunities in the demand zone of 1.3607 – 1.3560. Entry opportunities will appear when the price is in correction mode toward the demand zone 1.3607.

Be aware of the USD/CAD correction when it is able to pass through the 1.3560 level since the price will be under pressure to continue its move to the demand zone 1.3430 – 1.3380 and change the short-term trend to bearish.

  • Therefore, set a long position at 1.3607 when the price manages to enter the demand zone and there is a bullish signal confirming it. Stop loss may be positioned at 1.3560, while the profit target is at 1.3717.
  • Alternatively, set a short position at 1.3560 when there is a significant breakout signal confirming it. Stop loss may be positioned at 1.3607, while the profit target on 1.3430.

Keep in mind to always use risk and money management before trading! In addition, to make use of trailing stops, don't forget to exit the market as soon as you find a reversal signal!

USD/CAD key levels: 

  • Resistance: 1.3763, 1.3717
  • Support: 1.3607, 1.3560, 1.3430, 1.3380