EURCAD in consolidation?

Good afternoon ladies and gentlemen

Almost at the end of another trading week. Let's see how the EURCAD has behaved since yesterday as I was unable to do an update then! Apologies!

So when we left her last, price was doing a DT with a divergence on MACD on the 1 hour chart and true to form price has since com back down and has been hovering sideway within the S and R zone, at one point even breaking south to restest the VI.

As SM we should know that price never moves in a straight line. After a big move, there is always a period of adjustment before a further move in that direction. It is usually during these periods where psychology plays a massive part in trading. Stops maybe tigthened and trades may be closed. Depending on your entry, swing traders may find that during these periods of retracement they go from being in a healthy profit to negative territory. As a result stops are tightened as damage limitation only to see price turn in their favour but after being stopped out!

However, as SM we "go with the flow" and understand the "trend is our friend" and do nothing but follow our TP and not deviate in the slightest and let the market take its natural course!

So below is the daily chart and we can see that price has been bullish since 9th of June 09. After a continuous move North it seems like we are seeing our first period of adjustment.

The question is how far could price drop before or if we see another move up. Could we see price drop as far as the RN? Or could it be that price has dropped as far as it wants seeing as on the 4 hour chart (posted below) the trend line, the S and R zone and the RN cluster prove too strong for price to break and push price up?! What are the other indicators saying? RSI has just crossed the midline! I will leave you to check the rest!

I will leave you with this thought "Do you ever feel compelled to make a trade because you think you might miss out?"

Till tomorrow

Abundance is your Birth Right

Zaheer Anwari