Forex Trading: USD/CAD Has A Wild Up And Down Day

The USD/CAD has had a wild up and down time of it since last Friday.  The pair has been moving up and down, using the 100 hour moving average (Blue Line) and the 200 hour moving average (Green Line) as the lower and higher boundaries.

There was one instance in the last hour when the pair triggered stops to the upside.  However, within 5 minutes the weak handed longs, were selling their positions and forcing the pair back down toward the bottom support level.

This type of activity suggests the market is being controlled by intraday flows that do not have a strong conviction one way or the other.  There are two ways to trade this type of market.  The first is to trade the range.  An alternative would be to be patient and wait for the break up or down.  If time and momemtum can be maintained in the direction of the break, the chances of a trend in the direction is great.  However, if time above or below cannot accumulate, it suggests to simply exit the trade and wait for another opportunity later.

Posted in Categories: Canada, Contributor, External Research, Forex, USA.

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