In order to meet the 1:2 risk/reward ratio, the price must move lower, where the ideal entry price could be located between the 0.9300 psychological level and 0.9340.
Disclaimer: The analysis presented in this article is for educational purposes only and should not be considered as financial advice.
This analysis was done on MetaTrader 4.
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Trade Idea Details:
AUD/CAD symbol
Type: Bullish
Key support levels: 0.9277
Key resistance levels:0.9426
On the 4-hour chart, the uptrend remains valid, and AUD/CAD continues to trade above the 200 Exponential Moving Average. On June 9, price produced a spike below the 200 EMAm hitting 0.9291 low. Then on June 15th, there was an attempt to break below the 0.9291 support level, although there was no 4H close below. Finally, there was a rejection of the average price trendline which yet again confirmes the bullish domination.
Therefore, as long as a 4-hour closing price remains above the 0.9270, uptrend continuation should be expected. Price could be heading up towards the 161.8% Fibonacci retracement level at 0.9517. This is a potential 180 pips upside move, which should be considered as a medium-term opportunity.
Potential Trade Idea:
Once/if AUD/CAD reaches 0.9340, the buying opportunity should be open. The upside target could be set at 0.9515, which is just a few pips below the Fibonacci resistance. The stop loss must be below the 0.9270 low, and to meet the required RR should be placed at 0.9252.
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