Acc Risk: 0.4%
Stop: 0.9767 (23 pips)
Target: 0.9968 (178 pips, 4h100, 7.73x RR)
Mindset: Prefer this set up to the USDCAD, feel it will run soon enough
Spotted this set up when scanning the short CAD plays. The set up is pretty good, decent entry and a nice rolling divergence. I can’t make up my mind whether this is a single or double divergence. There’s quite a lot of time between the last MACD major low and this one.
For the time being I’ve picked double divergence and the 4h100 as a target.
Trade was taken AM, Screenshots were late PM, same day
4H Chart – set up
Single or double divergence? Aiming for the 4h100 for now.
1H Chart – confirmation
Double divergence confirmation. Shame the 1h100 is so close.
Noticed the price action around the d500.
Update – Closed the trade manually – 12 Jul
Had some nice progressive price action up to the 4h50; I’ve been re-looking at my charts and I’ve decided I can’t justify the double divergence target, so I’ve just closed the trade.
It seems to me that I’m not comparing similar price action together. The price action in block 1 seems different to block 2. I think they are distinct, there’s enough price action going on between the MACD lows to make them separate divergences (as shown). Technically the first divergence isn’t a divergence but price action running into MAs and S&R zones often fudge the set ups. I still think it’s valid 🙂
I also noticed the price action in section 2 hasn’t tested the 4h50 – it’s made 3 attempts at the 4h20 but never broken it. So this is the first test since we started the trend down.
One other big factor in my decision; BoC are due to make a decision on their interest rates today. It’s expected to go up and so that’ll be bearish for the Aussie. As it’s expected, I’m thinking it maybe priced in? But I’m not that far from my entry and Interest Rate decisions are on the upper end of the scale in terms of volatility. So I’m happy to have hit target before the announcement.
Update – BoC raises rates to 0.75% – 12 Jul
Wow, I feel lucky to have got away with this one, I was really in two minds about keeping my position open or closing it. BoC did raise their interest rates and price has reversed the last few days, and some more. We’re now making a new low.
We’re now heading for another divergence a test of a monthly trendline and the w500! Hmmmm, this seems like it could be too good to be true?
Missed the re-entry – 13 Jul
I was looking for a retest of the 5MA or a bit lower to get long on this but price just ran away.
I did notice the strength of the move when I was checking the market, it probably moved 10 odd pips in less than a minute, which is unusual for a pair like that in the UK morning session, with no news events due.