News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site. See our updated Privacy Policy here.



Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events


Economic Calendar

Economic Calendar Events

Free Trading Guides
Please try again
More View more
Real Time News
  • Ethereum is starting to outperform Bitcoin again ahead of ETH’s latest upgrade, while Binance continues to pare back business areas amid ongoing regulatory pressure. Get your crypto forecast from @nickcawley1 here:
  • Do you know how to properly Identify a double top formation? Double tops can enhance technical analysis when trading both forex or stocks, making the pattern highly versatile in nature. Learn more about the double top formation here:
  • It’s important for traders to be familiar with FX spreads as they are the primary cost of trading currencies. Understand a pair's spread here:
  • Forex sentiment analysis can be a useful tool to help traders understand and act on price behavior. Learn how to get the most out of understanding trader sentiment here:
  • Emotions are often a key driving force behind FOMO. If left unchecked, they can lead traders to neglect trading plans and exceed comfortable levels of risk. Read on and get your emotions in check here:
  • Greed is a natural human emotion that affects individuals to varying degrees. Unfortunately, when viewed in the context of trading, greed has proven to be a hindrance more often than it has assisted traders. Learn how to control greed in trading here:
  • There are three major forex trading sessions which comprise the 24-hour market: the London session, the US session and the Asian session. Learn about the characteristics of each session here:
  • The Australian Dollar remains vulnerable in the week ahead, eyeing risks such as a dovish RBA, surging Covid cases and recent crackdowns by Beijing. Might US NFPs offer some relief to AUD/USD? Get your weekly AUD forecast from @ddubrovskyFX here:
  • $AUDNZD closed at its lowest since December 2020 Prices pierced the 1.0541 - 1.0564 support zone, exposing the November low at 1.0418 A confirmatory downside close under support next week may open the door to further losses #AUD #RBA
  • Did you know a Doji candlestick signals market indecision and the potential for a change in direction. What are the top five types of Doji candlesticks? Find out
Long and Short Opportunities in AUD/CAD

Long and Short Opportunities in AUD/CAD

Kaye Lee, Head Forex Trading Instructor

Talking Points:

  • Developing Downtrend on AUD/CAD Daily Chart
  • Short Set-up on 4-Hour Chart
  • Long Scalp Trades for the Short Term

AUDCAD is offering two trade possibilities as it begins to display a potential downtrend on the daily chart. A rising support line has been broken, but it is only now being retested. A declining channel is also potentially forming.

Guest Commentary: Beginnings of an AUD/CAD Daily Downtrend

Long_and_Short_Opportunities_in_AUDCAD_body_GuestCommentary_KayeLee_November18A_1.png, Long and Short Opportunities in AUD/CAD

An actual downtrend still has yet to be formed, however. The lower high and lower low formation is encouraging, but the untested broken uptrend line is an issue. Before price gets there, it will have to deal with resistance from the declining channel, as shown on the daily chart.

In looking at the four-hour chart below, which magnifies the declining line of resistance from the downwards channel, an estimated resistance zone has been obtained between 0.9840 and 0.9878.

There is a rising wedge pattern, but given the daily chart pattern, it is anticipated that the price may overshoot upwards out of the wedge into the resistance zone before turning around.

Guest Commentary: Key AUD/CAD Resistance Zone

Long_and_Short_Opportunities_in_AUDCAD_body_GuestCommentary_KayeLee_November18A_2.png, Long and Short Opportunities in AUD/CAD

Of course, as indicated on the daily chart, this resistance may not be able to overcome the magnetic power of an untested broken trend line. However, it is a valid area for taking nibbles at the short side.

Traders should be ready to take one or two tries on the short side on the hourly chart should price rally to this area and give short signals like pin bars, bearish engulfing patterns, or reversal divergence.

At the time of writing, the pattern is far from ready to be traded, and it may take some time to get there. However, a lower time frame may offer a more immediate trading opportunity.

The hourly chart below shows a pennant, or triangle pattern, following a declining move and the formation of a pole.

Using the Fibonacci expansion tool and estimating a breakout level from the end of the triangle, a break to the downside would have to deal with support from the 0.9771-0.9783 zone.

Guest Commentary: Potential AUD/CAD Buy Opportunity

Long_and_Short_Opportunities_in_AUDCAD_body_GuestCommentary_KayeLee_November18A_3.png, Long and Short Opportunities in AUD/CAD

For those who want to understand the reasoning behind this long-entry opportunity:

  1. A pole followed by a consolidation pattern (flag, pennant, etc.) is usually followed by a breakout in the same direction as the pole move, which, in this case, is down.
  2. That move is usually projected to be 61.8%, 100% or 161.8% of the original pole's move.
  3. However, in this case, that level would be a break of the larger rising wedge pattern, which suggests that price should not go too far before being pulled back up to retest the underside of the broken rising wedge.
  4. Thus, the 61.8% -100% levels form a reasonable zone in which to look for a long scalp set-up.
  5. This move has justified reward for risk because the potential of the move is to begin a longer-term swing upwards to trigger the hourly short trade described in the first half of this article.

Those who wish to prepare for the trading opportunity should be eyeing 15-minute-chart longs for this second set-up, which would be triggered especially by pin bars, although bullish engulfing patterns and reversal divergence would also be acceptable.

Keep in mind this is a countertrend trade, and so a large part of the position (up to 75%) should be taken out as defensively as possible at the first sign of trouble, with a small, longer-term component held just in case this trade runs a long way into profit. After all, the higher-time-frame short may fail as prices race up to retest the underside of the broken trend line on the daily chart.

In this transitioning AUDCAD market, the best response is to have a mindset and trading plan for both shorts and longs, as we’ve described here today.

By Kaye Lee, private fund trader and head trader consultant,

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.