Good day traders!
The USD/CAD pair made a strong and quick turn, but to the upside, which was technically expected, as we were observing a bigger Elliott-Wave ending diagonal pattern in wave 5. Once this pattern fully unfolds, a sharp and strong reversal tends to follow. We see waves a)/i) and b)/ii) completed, so current rally can be in wave c) or three. Former swing high at 1.2381 can offer resistance for current rally.
An ending diagonal is a special type of pattern that occurs at times when the preceding move has gone too far too fast, as Elliott put it. A very small percentage of ending diagonals appear in the C wave position of A-B- C formations. In double or triple threes, they appear only as the final “C” wave. In all cases, they are found at the termination points of larger patterns, indicating exhaustion of the larger movement.
Disclosure: Please be informed that information we provide is NOT a trading recommendation or investment advice. All our work is for educational purposes only.
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