Good morning, traders! Today we will analyze USD CAD in three timeframes to show you why we consider upside potential in this pair. We will analyze from a higher to a lower timeframe to contextualize the analysis and detail how the three visions coincide.
🔸First of all, we have the Weekly Chart:
- In this chart, the analysis is very simple. We see a marked downtrend and the price facing an interesting support zone. This is not enough to consider a trade, but we already have a key level that is being tested. There is the possibility of a rebound.
🔸Now we are going to reduce the timeframe to the Daily Chart:
- Here, we will mark the most recent trend that we can put within a channel, and we will mark the support and resistance areas closest to the price. This will determine between which zones the price can move during the following weeks. We already have the Weekly and Daily context, but we don't have a setup idea yet.
🔸It is time to go down to the 4H timeframe, and here we are going to raise the situation that we will look for:
- We see the rebound in the support zone and a Bullish Engulfing Candlestick that shows us a rejection in the zone. This is the first bullish sign. Also, the price is trying to break the descending trendline. What we will expect will be a clear breakout and then a retest/correction. Once that happens, the next thing will be to wait for the bullish continuation. If this happens, we will be facing a potential movement whose target is the next Resistance zone or the descending trendline, whichever comes first.
🔸First of all, we have the Weekly Chart:
- In this chart, the analysis is very simple. We see a marked downtrend and the price facing an interesting support zone. This is not enough to consider a trade, but we already have a key level that is being tested. There is the possibility of a rebound.
🔸Now we are going to reduce the timeframe to the Daily Chart:
- Here, we will mark the most recent trend that we can put within a channel, and we will mark the support and resistance areas closest to the price. This will determine between which zones the price can move during the following weeks. We already have the Weekly and Daily context, but we don't have a setup idea yet.
🔸It is time to go down to the 4H timeframe, and here we are going to raise the situation that we will look for:
- We see the rebound in the support zone and a Bullish Engulfing Candlestick that shows us a rejection in the zone. This is the first bullish sign. Also, the price is trying to break the descending trendline. What we will expect will be a clear breakout and then a retest/correction. Once that happens, the next thing will be to wait for the bullish continuation. If this happens, we will be facing a potential movement whose target is the next Resistance zone or the descending trendline, whichever comes first.