GBP/CAD - Further Drop Expected

Due to the overall bearish sentiment in the GBP because of the latest developments regarding the no-deal Brexit and potentially a second referendum in November GBP/CAD pair looks weak and is expected to further slide after the Mondays' retracement. Furthermore, CAD is supported by strong fundamental data and the strong oil prices that are set to further rise in the upcoming days, (Brent broke multi-month/year highs). As a result, it is reasonable to trade the weakest currency, which is GBP (after JPY) against the strongest - CAD.

The idea is to trade the break of the short-term uptrend with multiple confirmations to further confirm the bearish bias.
1. Break of the 50d EMA.
2. Break of the support level/38.2% Fib Retracement
3. Break of the longer-term uptrend line (red).
For additional confirmation, I am going to use the 1h candle time filter.
First target, 3 pips above 1.69 level with a potential break further down, will consider trailing the stop after.

There is still a possibility that the GBP price will continue its move up through today's session, thus a break and close above the 200d EMA would cancel my trade set up.

Wish all a great trading day!

Kommentera:

Update: Despite the fact that the war a break lower, the trade was not opened as there was 1h time filter (1 hour candle close).

Order avbruten:

The trade set up was cancelled as the price demonstrated a close above the 200d EMA