USD/CAD: Quasimodo to signal end of downtrend?
We've entered the preceding weekly wave 4 zone since we surpassed the wave 3 swing high level at around 1.2840.
By no means is this a guarantee that the current downtrend has ended (possible end of corrective wave A) but it does make me more inclined to go looking for possible trend reversal signals.
This Quasimodo pattern may be just that!
I'm already long from 1.2630, but the current level is imo still a good level to enter long for a possible big move up (B wave?) or perhaps it is only a smaller degree retracement before the downtrend continues...
Either way, for me the setup is good, targets are the 61.8% and 88.6% retracements of the last down move. Beyond that, if we ever get that high, I will keep an eye on whether or not the trendline in the top right corner of the chart will break or not to confirm the possible larger degree wave B up move on which I will try to add longs.
In case this setup fails and the downtrend resumes we might be on the way for that important weekly wave 4 swing low support level... In that case the following down move may be quite violent, so watch out and keep your SL tight!
By no means is this a guarantee that the current downtrend has ended (possible end of corrective wave A) but it does make me more inclined to go looking for possible trend reversal signals.
This Quasimodo pattern may be just that!
I'm already long from 1.2630, but the current level is imo still a good level to enter long for a possible big move up (B wave?) or perhaps it is only a smaller degree retracement before the downtrend continues...
Either way, for me the setup is good, targets are the 61.8% and 88.6% retracements of the last down move. Beyond that, if we ever get that high, I will keep an eye on whether or not the trendline in the top right corner of the chart will break or not to confirm the possible larger degree wave B up move on which I will try to add longs.
In case this setup fails and the downtrend resumes we might be on the way for that important weekly wave 4 swing low support level... In that case the following down move may be quite violent, so watch out and keep your SL tight!
