Commentary on the USD/CAD

Forexmentor.com Forex Trading Price Action

It sure looks like the USD/CAD is trying to base on the hourly chart – as at mid-day Wednesday, June 6/07. We’ve had a couple days where the 0560 level has held in terms of support. I’m sure Steve Nison would agree based on what he had to say in his two recent webinars for Forexmentor.com – which were great, by the way. A hammer ended the swoon in price June 3rd. That said, the EMAs (50, 100, and 200) are all stacked favoring the continuation of the down-trend. Let’s see if the aforementioned support holds.

We’re all looking for a turnaround in this pair – at least the fundamentals seem to support that notion, depending upon who you talk to. The Canadian economy really starts to suffer, as its currency rises – translation: USD/CAD falls. When the turn comes, it will represent a golden trading moment. We’ll see.

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One of the golden nuggets of forex trading

Forexmentor.com Forex Trading Price Action

Bollinger bands are very useful in determining price direction. Standard settings are all you have to concern yourself with. Take a look at the 15 minute chart for the USD/CAD pair June 3-4/07. You will notice that, whenever the bands tighten, price explodes out the other end in a direction that is pretty much determined by the attitude of the 200 EMA. If it is sloping down, then price will invariably come out of the constricted phase of the Bollinger bands, and move in kind – down, in this case.

You will also notice with Bollinger bands that, once price exceeds one of the bands, it usually retraces within the bands, and heads for the other extreme – the other band. So, keep your eye on that 200 EMA, watch price exit a narrow channel of Bollinger bands, and head in the same direction – more often than not. Just one of the golden nuggets of forex trading info. you will find at: www.forexmentor.com

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