AUD/CAD-2 Potential Ways to Trade

If you look at a short-term chart of the AUD/CAD you will see a lot of “chop”.  Zoom out to the daily and you see more of an uptrend that has flatlined.  Zoom out further, to a weekly chart, and we see what could be a cycle top being put in.  This is not confirmed yet, but at this point is just something to watch.  A drop below 0.9200 indicates a downtrend, and there are two basic ways to play it – the short-term and long-term.

The short-term trade is to place a profit target just above 0.88, or more conservatively near 0.8950.  These are targets for the breakout based on the last several months for price action.

The longer term play is to assume that if the pair breaks below 0.9200, then a cyclical top is in place, and targets would be placed just above 0.80, with aggresive targets at 0.78 and 0.76.

If trading multiple lots, then the possibility exists to exit a portion of the position at each target, but that is up to the trader and their trading plan.

This set-up remains a “wait and see.”  Until the pair breaks below 0.9200, which could take a while, I will not be doing anything with it.  Right now the pair trades at 0.9338

Cheers,

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