Transcript of Video
From Forex Traders Daily, this is your daily analysis with Ross Mullins, live from Richmond, Virginia.
Hello everyone, this is today’s video analysis for July 14, 2017. Today we’re going to be taking a look at the US Dollar versus the Canadian Dollar [USDCAD] for today’s trade analysis.
The first thing I want to point your attention to here on the daily timeframe is the little black box, bottom left-hand corner of the chart. What we want to note is the yellow, the pink, and really the green-shaded area at the very bottom of the chart as well, but primarily the yellow and the pink zone. Why? Because that’s where the market is.
If you look to the right-hand side of the chart, current market is just underneath the yellow-shaded area and 1.2735 to 1.2770 is that yellow-shaded area. So, over here, back again on the left, we can see that when the market was under the yellow-shaded area, there was this tendency for it to go down at least to the pink-shaded area. We saw one time where it went down to the green zone, but at least to the pink-shaded area. We saw it here, we saw it here, and we saw it here.
So, there’s this multiple confirmation that under the yellow zone there’s the potential for it to go down to the pink zone. And only really once it gets back above the yellow zone do we expect it to go back up. So, that’s one thing that we’re looking at here in the current market, is that we’re under the yellow zone and there will likely be this tendency for it to continue the downtrend and float down to the pink zone. And of course if it breaks the pink zone, we already know the likelihood of it going to the green zone is pretty good as well.
Now let’s bring it back over to our current time. We’re clearly in a downtrend. The red trend line. The black trend line show us clear downtrend. I don’t think anybody is going to argue with that. We are pretty close to the bottom of the trend. Obviously if you’re going to sell something, selling it at the lowest possible price is not usually the best idea, but I think we’re seeing some evidence that could give us an opportunity for the day to sell it underneath the yellow zone and look for that continuation of the downtrend. Especially if we get some news today that’s not 100 percent great for the USD, we could see the continuation.
Of course we also look to oil prices as well. If oil continues to pressure higher, we look for the USDCAD to go down. That’s always something that we look at in the live Trade Room as well. Forex Black Book is red. So, everything right now is pointing bearish here for the USDCAD, so that’s what we’re looking for. An opportunity to go bearish.
Zoom it in a couple of times. We could see that we’re underneath the yellow-shaded area today. 1.2735 to 1.2770 again. The pink zone. 1.2670 to 1.2625 is the pink zone. So, again, what I’m looking for is the market to stay under the yellow zone. Once it breaks that barrier, we look for it to stay underneath. Target the next barrier, which happens to be the pink zone. And our risk in this scenario is that the market changes its mind, the USD goes bullish, and we get it back above 1.2770.
Take it back down to the four-hour timeframe. Again, zoom it out like this and you could see the market just holding underneath that yellow zone. So, the expectation is so far the buyers have been unable to get it back above that yellow-shaded area. The sellers are holding the buyers out. And so, what we’re going to look for is the continuation. The sellers to return after a bit of a break here and drive it back down to the pink zone.
Of course our risk here is, again, just above the yellow zone. Our stop loss would go above it because we don’t want it to break back above the yellow zone. If it does, we look to get out of it and look for a new opportunity. So, at this point, no break above 1.2770, the risk, and we’re going to look to target back down to the pink zone for the USDCAD today.
From Forex Traders Daily, this has been your daily analysis with Ross Mullins. If you would like to get Ross’ analysis on all the currency pairs he’s watching and all the trades he takes today, join him in his live Trade Room by clicking on the link below. Please leave any comments you have about today’s video in the comment section below.