decline in CAD watch!!! | Forex Factory

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decline in CAD watch!!!

  • #1
  • First Post: Edited 4:11am May 10, 2008 4:07am | Edited 4:11am
I dont actually trade the canadian dollar called the loonie but there was a cry for it from clients that makes me want to have a look on it then when i saw it i said oops who could have guess i said i should rally the troops and let every one knows about it.
patterns on differnt canadian dollar crosses indicate a high probability that the loonie will fall across the board let us take a look at the cad/jpy first
there have been series of lower lows and lower highs since the november 2007 top at 125.55
declines have occurred in 5 waves and advances have unfolded slowly as complex corrections (w-x-y). The trend is considered down as long as price is below 109.62. The minimum objective is below 95.68 but additional objectives are at 94.61 and 89.73 (Fibo extensions). but i will wait for a break 100.95 then i will pull the trigger.

eur/cad
The decline from 1.6324 (March high) in the EURCAD is viewed as the correction of the 5 wave advance from 1.4410. The decline reversed at 1.5395, a level that is defended by the 3/19 low at 1.5459 and the 38.2% of 1.4410-1.6324 at 1.5367. Bigger picture, the decline from 1.6324 is probably a 4th wave within the 5 wave advance from 1.4162. Therefore, a 5th wave should complete the cycle. The minimum objective is above 1.6324. Risk is tight at 1.5395.
the various line on the chart are the various resistance we might meet
enjoy


oops i realise that i can not add the chart that i save well check cad/jpy daily chart and eur/cad 4hrs chart
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  • #2
  • May 10, 2008 5:44am May 10, 2008 5:44am
Quoting gardenofpips
I dont actually trade the canadian dollar called the loonie but there was a cry for it from clients that makes me want to have a look on it then when i saw it i said oops who could have guess i said i should rally the troops and let every one knows about it.
patterns on differnt canadian dollar crosses indicate a high probability that the loonie will fall across the board let us take a look at the cad/jpy first
there have been series of lower lows and lower highs since the november 2007 top at 125.55
declines have occurred in 5 waves and advances have unfolded slowly as complex corrections (w-x-y). The trend is considered down as long as price is below 109.62. The minimum objective is below 95.68 but additional objectives are at 94.61 and 89.73 (Fibo extensions). but i will wait for a break 100.95 then i will pull the trigger.

eur/cad
The decline from 1.6324 (March high) in the EURCAD is viewed as the correction of the 5 wave advance from 1.4410. The decline reversed at 1.5395, a level that is defended by the 3/19 low at 1.5459 and the 38.2% of 1.4410-1.6324 at 1.5367. Bigger picture, the decline from 1.6324 is probably a 4th wave within the 5 wave advance from 1.4162. Therefore, a 5th wave should complete the cycle. The minimum objective is above 1.6324. Risk is tight at 1.5395.
the various line on the chart are the various resistance we might meet
enjoy


oops i realise that i can not add the chart that i save well check cad/jpy daily chart and eur/cad 4hrs chart
What's your prediction about usdcad considering the fact that USD is rather weak now, against euro and jpy. Will USDCAD also rally in the weakening wave of the CAD?
Expected the unexpected
  • #3
  • May 10, 2008 6:21am May 10, 2008 6:21am
Quoting gardenofpips
let us take a look at the cad/jpy first
there have been series of lower lows and lower highs since the november 2007 top at 125.55
Yeah lets look at dailly can/jpy,..it shows a beautifull morning doji star ,..and we were making a serious of higher highs and higher lows after it had rebounded, it is still aprox 24% down from all time high...so if yen continues to weaken accross the board, the cy will go higher as well,...its a fair price right now if u ask me, and as long as 101.66 holds, we should make new highs....and the news on friday was outrages for canadians, so further cuts are in big question, more likely they will make a hike if u ask me...against usd or euro it is still a bad bet,..but not against the jpy...who knows...im long 102.41, targeting 105.66...
its just money
  • #4
  • May 10, 2008 6:30am May 10, 2008 6:30am
Quoting de123
Yeah lets look at dailly can/jpy,..it shows a beautifull morning doji star ,..and we were making a serious of higher highs and higher lows after it had rebounded, it is still aprox 24% down from all time high...so if yen continues to weaken accross the board, the cy will go higher as well,...its a fair price right now if u ask me, and as long as 101.66 holds, we should make new highs....and the news on friday was outrages for canadians, so further cuts are in big question, more likely they will make a hike if u ask me...against usd or euro it is still a bad bet,..but not against the jpy...who knows...im long 102.41, targeting 105.66...
JPY weakening? Looks to me like it's been strengthening for the last couple of days, even though it had weakened a little earlier.
Expected the unexpected
  • #5
  • May 10, 2008 7:18am May 10, 2008 7:18am
Quoting gardenofpips
I dont actually trade the canadian dollar called the loonie but there was a cry for it from clients that makes me want to have a look on it then when i saw it i said oops who could have guess i said i should rally the troops and let every one knows about it.
patterns on differnt canadian dollar crosses indicate a high probability that the loonie will fall across the board let us take a look at the cad/jpy first
there have been series of lower lows and lower highs since the november 2007 top at 125.55
declines have occurred in 5 waves and advances have unfolded slowly as complex corrections (w-x-y). The trend is considered down as long as price is below 109.62. The minimum objective is below 95.68 but additional objectives are at 94.61 and 89.73 (Fibo extensions). but i will wait for a break 100.95 then i will pull the trigger.

eur/cad
The decline from 1.6324 (March high) in the EURCAD is viewed as the correction of the 5 wave advance from 1.4410. The decline reversed at 1.5395, a level that is defended by the 3/19 low at 1.5459 and the 38.2% of 1.4410-1.6324 at 1.5367. Bigger picture, the decline from 1.6324 is probably a 4th wave within the 5 wave advance from 1.4162. Therefore, a 5th wave should complete the cycle. The minimum objective is above 1.6324. Risk is tight at 1.5395.
the various line on the chart are the various resistance we might meet
enjoy


oops realise that i can not add the chart that i save well check cad/jpy daily chart and eur/cad 4hrs chart
I swing trade the eurcad only as it moves in beautiful waves. I think wave 5 on the weekly was completed recently at the treble top on the daily.

Here is the weekly chart. The last time rapid rsi dropped from overbought when regular rsi did also there was a 2000 pip decline. We have only just started that decline. The 5 week consolidation just under 1.6300 is typical box consolidation and can indicate major tops.

under the weekly chart is the daily. This is simple. We are coming down off a treble top. As long as we stay in the linear regression channel I am thinking we may get a retracement down to the 61.8% fib of the move up at 1.5150 zone. We are under the 50 sma on the daily also and the 10 sma crossed down thru the 50 a few days ago , nice bearishness in the charts. 1.5500 is the number to break , we tried it once and bounced hard as the usdcad gained strength in the middle of last week.

Now consider the second treble top as the dividing line , if we mirror image the move up , then the move down could be to 1.4500.

8 hour is simple. ... we have a bearish moving average stack , 10 over 20 over 50 . On the move up from 1.4500 the moving averages were in a bullish stack the whole way up , so unless this bearish stack is broken on the 8 hour we are heading down.

The 2 hour is forming a pennant , this is a continuation pattern to the downside.

I am bearish on this pair , and have emailed my trading group to get short under 1.5500 for all of the reason mentioned above , 1st target 1.5000.

Now if we break the 50 sma on the daily to the upside all bets on the bearish bias are off.

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  • #6
  • May 10, 2008 7:25am May 10, 2008 7:25am
Quoting malcolmb14
I swing trade the eurcad only as it moves in beautiful waves. I think wave 5 on the weekly was completed recently at the treble top on the daily.

Here is the weekly chart. The last time rapid rsi dropped from overbought when regular rsi did also there was a 2000 pip decline. We have only just started that decline. The 5 week consolidation just under 1.6300 is typical box consolidation and can indicate major tops.

under the weekly chart is the daily. This is simple. We are coming down off a treble top. As long as we stay in the linear regression channel I am thinking we may get a retracement down to the 61.8% fib of the move up at 1.5150 zone. We are under the 50 sma on the daily also and the 10 sma crossed down thru the 50 a few days ago , nice bearishness in the charts. 1.5500 is the number to break , we tried it once and bounced hard as the usdcad gained strength in the middle of last week.

Now consider the second treble top as the dividing line , if we mirror image the move up , then the move down could be to 1.4500.

8 hour is simple. ... we have a bearish moving average stack , 10 over 20 over 50 . On the move up from 1.4500 the moving averages were in a bullish stack the whole way up , so unless this bearish stack is broken on the 8 hour we are heading down.

The 2 hour is forming a pennant , this is a continuation pattern to the downside.

I am bearish on this pair , and have emailed my trading group to get short under 1.5500 for all of the reason mentioned above , 1st target 1.5000.

Now if we break the 50 sma on the daily to the upside all bets on the bearish bias are off.
Am I right in understanding that you feel the CAD decline call is totally incorrect? What is your opinion on USDCAD since that's the pair I have been watching for a little while and would be interested in knowing your take on it. Where do you think it's headed? Some major banks are saying that it's going to at least 1.03. You? Thanks.
Expected the unexpected
  • #7
  • May 10, 2008 7:27am May 10, 2008 7:27am
Quoting scyang
JPY weakening? Looks to me like it's been strengthening for the last couple of days, even though it had weakened a little earlier.
here you go .. classic bear flag .. it hit 61.8% of the flag pole pole bang on.
If we break 50 sma on the daily at 101.1 down we go to 90 (the flag pole was 1000 pips long)

I am watching the 12700 area closely on the dj-30. This is major support zone.

With AIG reporting 9 bil write down , not because of sub prime , but because of credit derivatives we could see the start of the next bear leg down of the markets. I have been watching and waiting for this. This is the first financial institution I have seen reporting a write down due Credit derivatives. The credit derivatives will make sub prime issues look micky mouse.

If credit derivative write downs become wild fire , like sub prime did i see dj down at 10500 in September.

This will make all JPY crosses drop like a rock .

Attached Image (click to enlarge)
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  • #8
  • May 10, 2008 7:40am May 10, 2008 7:40am
Quoting scyang
Am I right in understanding that you feel the CAD decline call is totally incorrect? What is your opinion on USDCAD since that's the pair I have been watching for a little while and would be interested in knowing your take on it. Where do you think it's headed? Some major banks are saying that it's going to at least 1.03. You? Thanks.
I do not go by what banks say .. they are all crooks .....

Here is what the chart says ... weekly is in a flagging pattern , might be a bear flag , we have hit the 61.8% of the major move down on the weekly.

The price is stuck right under the 50 sma on the weekly.

There is talk of the USD getting stronger , however with record oil prices how can the CAD be weaker then the USD ? Now if the USD gets stronger the markets will drop as people start to move money into treasury bonds , investors who do not want to buy bonds will move money into gold , driving gold prices up above 1000 again ( there is talk of 1400 gold by next year).

How can the CAD lose as it is a commodity currency ?

So long term there is strong potential for it to drop into 0.9000 and maybe even lower.

Fundamentally though I am not sure how this would work as Canada's #1 trading partner is the US and unless we change the client base that we export our natural resources to a strong cad against the usd is not goo for the Canadian economy.

Now to the daily;y .. low highs and downward slope to the daily , we are resting on 1.000 level but are forming a descending triangle = bearish bias. If we break 1.0000 in the next week or so likely we will see massive moves in eurcad ( 500 - 800 pips) and about a 300 pip move to the downside in usdcad.

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  • #9
  • May 15, 2008 2:37am May 15, 2008 2:37am
so far am concern and am doing beautifully no qualms who knows i might be wrong as even monkeys fall out of trees
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  • #10
  • May 15, 2008 2:43am May 15, 2008 2:43am
Quoting gardenofpips
so far am concern and am doing beautifully no qualms who knows i might be wrong as even monkeys fall out of trees
CAD has been nothing but strengthening instead of falling. USDCAD is making lower highs and lower lows everyday.
Expected the unexpected
  • #11
  • May 15, 2008 8:37am May 15, 2008 8:37am
hmmm, here we go again i was asked alot of question about usd/cad well now am taking a closer look on the pictures now starting with cad/jpy we can really say nothing than we enjoying nice run in now then back to eur/cad the weekly gives me something interesting but i will wait to see what happens at the close of tomorrow if by end of tomorrow we have price in between 1.5541 and 1.5500 then i think i will load the bull
enjoy
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  • #12
  • May 18, 2008 10:53pm May 18, 2008 10:53pm
I don't usually trade CAD & don't usually want to either.

Rather naive question here.....

So, with the price of oil at record numbers, why hasn't this affected CAD ?
  • #13
  • May 18, 2008 10:56pm May 18, 2008 10:56pm
Quoting toshi
I don't usually trade CAD & don't usually want to either.

Rather naive question here.....

So, with the price of oil at record numbers, why hasn't this affected CAD ?
I am no expert or anything, but just watching the market, you can see that higher oil prices lead to stronger CAD. Canada is one of larger oil producing countries outside of middle east. So naturally high oil prices buoy the currency. Besides, CAD is a commodity currency. The uptrend in other commodiies also helps support it.
Expected the unexpected
  • #14
  • May 18, 2008 10:57pm May 18, 2008 10:57pm
Quoting toshi
I don't usually trade CAD & don't usually want to either.

Rather naive question here.....

So, with the price of oil at record numbers, why hasn't this affected CAD ?
Canadian economy follows the US .... we have to drop interest rates to maintain as close to parity as we can as US is our number 1 trade partner .

Until we find another #1 trade partner it is not in Canada's interest to increase the strength if the CAD
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  • #15
  • Last Post: May 18, 2008 11:53pm May 18, 2008 11:53pm
Quoting malcolmb14
Canadian economy follows the US .... we have to drop interest rates to maintain as close to parity as we can as US is our number 1 trade partner .

Until we find another #1 trade partner it is not in Canada's interest to increase the strength if the CAD
So far the numbers coming out Canada have not been as bad as those out of the US. Understandably, Canada doesn't want a strong currency against the dollar. I expect the pair to be hovering around parity for the remainder of the month till May 30th rate meeting. What's do you see from the chart?
Expected the unexpected
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