When to Buy the Canadian Dollar and Yen

TL;DR

Dale Pinkert discusses the range trade on the Euro, potential buying opportunity in USD/CAD, and the possibility of a head and shoulders pattern forming in the Yen.

Transcript

hi traders Dale Pinkert here ECB and Mario Draghi today created a range every once in a while in the markets you're gonna have a range that's going to be directional should it be able to close above it so we had the high today into the ECB in the Euro the high was 12:1 1287 currently trading 77 after that we sold off to support that I talked about ... Read More

Key Insights

• 🚾 Range trade is setting up for the Euro, and a close above 1.13 could result in an upward move.
• 💪 USD/CAD is showing strength despite strong crude oil prices, indicating potential buying opportunities.
• ⤴️ The Yen may be forming a right shoulder of a head and shoulders bottom pattern, with a potential rally towards 112.80.
• 😘 Considering the market's memory, last week's lows of 109.80 should not be breached for the pattern to hold.
• 😘 The Euro could face new lows if it breaks below 1.1229.
• 🖐️ Crude oil's movement plays a significant role in USD/CAD's performance.
• 😚 A close above 1.34 in USD/CAD could trigger a buying opportunity.

Questions & Answers

Q: What is the current range for the Euro and what could trigger a move upwards or downwards?

The range for the Euro is between 1.1287 and 1.2317. A close above 1.13 could extend the move up towards 1.14, while a move below 1.1229 could lead to new lows.

Q: Why is USD/CAD holding up despite strong crude oil prices?

Despite strong crude oil prices, USD/CAD is holding up well because Canada has not been able to take out the lows from March 19th. If USD/CAD closes back above 1.34, it could trigger a potential buying opportunity.

Q: What pattern could be forming in the Yen and what are the key levels to watch?

The Yen could be forming a right shoulder of a head and shoulders bottom pattern. Last week's lows of 109.80 should not be taken out for this pattern to hold. A rally towards the 112.80 level could be expected if the pattern continues.

Q: How does the market's memory play a role in analyzing the Yen?

Traders need to look at the left side of the market to understand its memory. In this case, the low before the low in March at 110.80 could be considered a left shoulder, and the recent low at 109.80 may be the head. This suggests the possibility of a right shoulder forming.

Summary & Key Takeaways

• The Euro is currently in a defined range between 1.1287 and 1.2317. A close above 1.13 could lead to an upward move towards 1.14, while a move below 1.1229 may result in new lows.

• USD/CAD is showing positive action despite strong crude oil prices. A close above 1.34 could trigger a buying opportunity, but a weak dollar could lead to a retest of the 1.3060 level.

• The Yen could be forming a right shoulder of a head and shoulders bottom pattern. If last week's lows of 109.80 are not taken out, the Yen may rally towards 112.80.