It was June 2nd, when USDCAD climbed to 1.3142 and it looked like it was only a matter of time for the pair to reach a new high above the previous one at 1.3187. But instead of continuing higher, the exchange rate reversed sharply to the south and, as a result of a steep sell-off, is currently trading much lower – near 1.2670. And while most people would search for a post-factum explanation of why USDCAD fell, our premium clients do not care about the “reasons”, because they received the following forecast on Monday, May 30th.
As visible, by applying the Elliott Wave Principle on the hourly chart of USDCAD, we came to the conclusion that as long as the top of 1.3187 was safe, the pair was likely to decline in wave (c) to the lows around 1.2700. A chart is all an Elliott Wave analyst needs, in order to be able to make an accurate forecast about any market. The next one visualizes how USDCAD has changed since the beginning of June.
It is true that the bears did not take over immediately. The pair kept on rising for a while. However, the important thing is that the invalidation level the Wave principle provided at 1.3187 remained intact, so all our premium clients had to do is wait for the situation to develop. Today, 8 trading days after the forecast, those who did must be very pleased with the results they got. It is really amazing to see that the method Ralph Nelson Elliott discovered in the 1930s is still helping traders correctly predict market reversals in 2016. Amazing, but not at all surprising, since human nature is what the Elliott Wave principle deciphers. And it takes a lot more than 80 years for that to change.
What to expect from now on? What is the bigger picture saying? Is USDCAD going to continue even lower or the support near 1.2670 would turn out to be too strong for the bears to breach? Prepare yourself for whatever is coming. Order your Elliott Wave analysis due out every Monday at our Premium Forecasts section. Stay ahead of the news in any market with the Elliott Wave principle.