EURCAD Trading Strategy: The New Trump Era

Since President Trump has officially entered the White House market conditions have changed. President Trump began by stating the US Dollar (USD) is too strong, which was backed by the Secretary Treasury Mnuchin. These remarks are having a significant impact on USD in the Forex market. We have been searching for a technical entry to short USD but at the time of this writing no firm entries are available. President Trump’s actions are likely to continue to affect the Forex market and we must adjust to the new market conditions. We have been monitoring the Canadian Dollar (CAD) against a basket of currencies.

EURCAD Daily Chart

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EURCAD Trading Strategy: The New Trump Era

EURCAD Daily Chart 25/01/17

1.4018 is also the weekly support. We did debate whether to wait for the weekly close but we believe a daily entry is appropriate. The potential drawdown is a re-test of the lower support line (in black), which is expected to be minor. As we are aware 1.4018 is a weekly support, a large portion of the anticipated gains may only take place after the weekly close but we should see some gains by the end of the week. Canada’s GDP is scheduled for release next Tuesday but based on the chart we suspect it may be due to a strong Euro. Trump’s impact on the market is greater than we have anticipated. For example. in the past a weak CPI from Australia would have had a negative impact on the Aussie for some time. AUD was able to retain its gains mainly due to a weak US Dollar. We have also noted the US Treasury yields play a key role in USD pairs and crosses, which is again due to Trump. We will have to see whether this is a temporary phase or that these are the new market conditions.

In regards to EURCAD, we would like to see a daily close as near as possible to 1.4018. If the price closes marginally higher than current levels it may increase the possibility of another leg lower before the anticipated reversal takes place. We will wait for the daily close in order to issue the trade.

EURCAD Trade Alert

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EURCAD Trading Strategy: The New Trump Era

EURCAD Daily Chart III 25/01/17

EURCAD long at market price (1.4050)
Take profit: 1.4350
Protective stop: 1.3933
Risk Ratio (RR): 1 : 3 (approx.)
Estimated duration: 8 days

EURUSD Trade Alert

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EURCAD Trading Strategy: The New Trump Era

EURUSD 4hr Chart 26/01/17

EURUSD long at market price (1.0675)
Take profit: 1.0780
Protective stop: 1.0633
Risk Ratio (RR): 1 : 2.3 (approx.)
Estimated duration: 4 days

Note: The 4hr close was too high, which increased the potential drawdown to -25 pips. If timed correctly we may also be out of the trade in tomorrow’s session.

27/01/17 UPDATE: EURUSD is trading at 1.0702 at the time of this writing.

Please click on the chart to enlarge:

EURCAD Trading Strategy: The New Trump Era

EURUSD 4hr Chart 27/01/17

We are closing 20% of the long trade at market price and shift the protective stop to the entry as this is a 4hr entry.

GBPAUD Trade Alert

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EURCAD Trading Strategy: The New Trump Era

GBPAUD 4hr Chart 30/01/17

GBPAUD long at market price (1.6598)
Take profit: 1.6820
Protective stop: 1.6510
Risk Ratio (RR): 1 : 2.2 (approx.)
Estimated duration: 5 days

Note: We would have preferred a lower price but we cannot determine if GBPAUD will re-test 1.6568. This is a 4hr entry.

GBPAUD triggered the protective stop as the support gave way, EURUSD triggered the stop at the entry but ended with a profit due to the partials’ realization.

02/02/17 UPDATE: We are downsizing our exposure to EURCAD. It is still held inside a range, which is not an optimal signal for either an uptrend or a downtrend. EURCAD is trading at 1.4012 at the time of this writing, we are closing 30% of the long trade at market price.

06/02/17 UPDATE: EURCAD is trading at 1.4062 at the time of this writing, we are closing 20% of the long trade at market price. The range continues in EURCAD, which is why we are downsizing the trade.

08/02/17 UPDATE: We can no longer tolerate the price range in EURCAD. We are shifting the stop to the entry despite the minimal distance from the market. We will be relatively close to the market but we have little choice in the matter.

09/02/17 UPDATE: EURCAD triggered the protective stop at the entry, ending the trade with a minor profit.

EURCAD Trading Strategy: The New Trump Era

As all trades are closed this page can now be accessed by all traders. Open trades and relevant intraday strategies are restricted to members only. We have been providing trade alerts in the Forex market since May 2014.
EURCAD Trading Strategy: The New Trump Era
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EURCAD Trading Strategy: The New Trump Era