Taking EURCAD and Explain Why GBP is so Weak

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Who is Selling GBP?

In a separate note, the reason why GBP is heavily sold is due to the referendum in Scotland that will be held on 18 September. Latest polls suggest 53% will vote NO to independence while 47% will vote YES, hence causing substantial losses to GBP against a basket of currencies.  The heavy selling was caused by ETF allocations to limit market exposure to GBP. We will continue to monitor recent developments and determine whether to take a trade in GBP. Keep following us for future updates.

EURCAD Technical Analysis

In what appears to be a complete surprise, our technical models our turning bullish for the Euro despite expectations for the European Central Bank (ECB) to announce new QE measures (ABS program). We are nevertheless refrain from executing long trades in EURUSD and choose to focus on EURCAD. Following the Bank of Canada (BOC) rate decision, the Loonie (Canadian Dollar) enjoyed decent FX demand, which caused Euro-Cad to slide over +40 pips at the time of this writing.

EURCAD 4hr Chart

Please click on the chart to enlarge:

EUCAD 4hr Chart 03/09/14

EURCAD Trade Alert, 3 September 2014

Reversed Head-And-Shoulders (H&S) on the 4hr chart with the key support at 1.4285 suggest exercising  buy-on-dips strategies in EURCAD. We are limited in time due to the Forex market volatility and enter the trade at market price with a tight strategic stop loss order. Our goal is to have our protective stop loss at the entry ahead of the ECB decision on Thursday afternoon. Many expect to ECB to take action and slash rates even further before introducing the QE. What will determine the outcome of our trade in EURCAD would be the statement. If the ECB will not slash rates a significant bullish squeeze will be seen in most EUR pairs and crosses.

EURCAD Trade Details

Long @ market price (1.4282)
Take profit: 1.4414
Protective stop:  1.4258
Risk Ratio (RR): 1 : 4 (approx.)
Estimated duration: 48 hours

All our trades are published in Trade Alerts and documented in Trades Performance. Trade Updates will be sent to DDMarkets subscribers and will be posted at the bottom of this page.

03/09/14 UPDATE: EURCAD is trading at 1.4305 at the time of this writing, We are closing  10% of the open trade at market price with a profit of approximately +20 pips.

03/09/14 UPDATE II: EURCAD is trading at 1.4312 at the time of this writing. After studying multiple time frames we believe it is safe to shift the protective stop to the entry (our entry is at 1.4282). As a precaution, we are liquidating another 10% of the open trade at market price.

04/09/14 UPDATE: EURCAD is trading at 1.4322 at the time of this writing. We are liquidating another 10% of the trade at market price.

04/09/14 UPDATE II: EURCAD was stopped at the entry. We achieved our goal in liquidating profits ahead of the ECB decision, which as you may already know slashed rates.  Although we are not in a significant profit at the time of this writing, we have made a tactical decision to short EURCHF ahead of the ECB rate announcement.

Taking EURCAD and Explain Why GBP is so Weak
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Taking EURCAD and Explain Why GBP is so Weak

                                             Taking EURCAD and Explain Why GBP is so Weak

Taking EURCAD and Explain Why GBP is so Weak

Last Updated on August 9, 2015