FX.co ★ USD/CAD analysis for June 17, 2013

USD/CAD Elliott Wave
Last week, the USD/CAD pair was trading downwards, impulsive wave [5] (coloured red) of the bigger wave C (coloured green) was developing. During the Friday's Asian and European sessions we could observe sideways movement between 1.0154 and 1.0185 area. Therefore, during the New York session this commodity currency did not manage to hold this level and the price has dropped to the new low at 1.0136 level. We can consider this movement as the end of the C wave (coloured green) of the bigger wave (4) (coloured blue). At the moment the USD/CAD pair is trading around 1.0155 area and we expect to see the price higher when development of the 3 wave (coloured blue) starts. In accordance with our wave rules and taking into account that wave 3 should retrace 161.8% of wave 1, we can define the potential targets with measuring wave 1 with take profit at 1.0222 (161.8% of wave 1). To reduce the risk, we can use invalidation point at 1.0135 level as stop loss. Alternate Count: Corrective Wave (4) (coloured blue) has one more wave to finish and if this count takes place, next support can be found around 1.0100 level. This count will be valid if price pushes below invalidation point at 1.0135 level.
Support and Resistance
(S3) 1.0095 (S2) 1.0115 (S1) 1.0145 (PP) 1.0165 (R1) 1.0195 (R2) 1.0215 (R3) 1.0245
Trading forecast
Proceeding from Elliott Wave rules today, the trend is expected to begin the upwards movement. That is why long positions at level 1.0160 with stop loss at 1.0135 and take profit at 1.0222 are recommended.