Nov 29 – Forex Analysis of USDCAD currency pair

Here is today’s Nov 29 – Forex analysis of USDCAD currency pair.

It has been about three weeks since I posted my last analysis of the USDCAD pair.

My family and I went on a week vacation to Asia in Hong Kong, which is why I wasn’t active in updating my Forex analysis.

Here’s a picture of us in Hong Kong Disneyland. Had a blast!

Mark & Extended Family - HK Disneyland Mark & Family - HK Disneyland Fireworks - Click to watch on Youtube!
Now onto my main topic for today.

Nov 29 – Forex analysis of USDCAD – Chart Analysis

Below is a chart of today’s action as of 10:13 AM Pacific time.

Nov 29 - Forex analysis of USDCAD

If I may, let me recall my thesis back in Nov 7th below:

  • Uptrend – I mentioned that the pair is currently on an uptrend
  • The currency pair dipped on Nov 6th but rallied back up on Nov 7th
  • The candle, however, did not touch the 20 SMA, which was my target entry point

The trend is your friend

As I mentioned in my last Forex analysis of USDCAD pair, “the trend is your friend until it bends”. So as we read through the succeeding days after Nov 7th, below are what we can derive from the chart:

  • The dip to the 20 SMA followed through two days later on Nov 9th
  • On Nov 10th, we can see a doji candlestick pattern formed
  • Then from there on, the price rallied back up
  • It is also noted that a two-day dip occurred again on Nov 21 & 22
  • Nonetheless, the currency pair rallied again thereafter

Long position

I did go long on the USDCAD pair. As I mentioned, I saw the doji candlestick pattern formed back in Nov 10th.

A “doji” is usually an indication of an indecision and potentially a reverse in direction. Now since the action was a dip to the 20-day moving average, it was more likely that the “doji” was a signal that the dip was over and will then continue on with the trend, which is the uptrend move.

I bought into the currency pair back in Nov 11th and took a long position.

Swing trade strategy

With this long position that I took, I decided that this time I’ll do a swing trade strategy instead of my usual day trading one that I more often take.

The reason for this is basically the thesis for “the trend is your friend until it bends”. I decided to ride the uptrend.

So until I see a potential signal for reversal or the end for the uptrend move I would remain in my long position. And yes, I am still long as of this writing and I already have an unrealized gain on my position as you can imagine.

Another point of view or thesis

There is also another thesis to be said on this chart. I’m sure you already noticed as clearly seen on the chart. The former resistance, looking left on the chart, and that it has already been broken, now becomes the new support.

So here are the other theses to be said:

  • Former resistance becomes new support
  • The Nov 9th dip to this support area was the first time it happened thus it is a very fresh one
  • There are likely a lot of buyers still in that support area
  • Buyers indeed proved to be strong as seen on the apparent rally afterwards

So there you have it folks. My short and sweet Nov 29 – Forex analysis of USDCAD currency pair.

I hope this has been informative for you and thank you for reading. Please comment your thoughts, feedback and questions below.

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Have a wonderful day! Cheers!

P.S. I’ve recently created a blog tutorial on how to trade Forex for beginners here. Check it out if you’re new to Forex trading.

8 thoughts on “Nov 29 – Forex Analysis of USDCAD currency pair”

  1. This is very interesting and I am just learning about it. I remember learning about penny stocks some years ago and was told that there are several periods in a year where prices would rise and fall.
    While I do not think that currency follows those rules, does it take many years to be able to see “trends” or is this something that must be constantly monitored?
    Congrats on your trip! You and your family look very happy 🙂

    1. Mark

      Yes Irma, all markets do tend to have phases of uptrending, downtrending and sideways or “going nowhere” trends. Though penny stocks is a different beast as they are indeed very high risk if one doesn’t know how to manage their risk and could definitely get into deep trouble with the wrong strategy.

      Forex or currency trading I find is more manageable for me especially for my style trading. Although of course it still also depends on the currency pair that you intend to focus and trade with. As for constant monitoring, it’s dependent on what type of trader you are. If you are a day trader, meaning you’re in and out of a trade within a single day, then yes it needs constant monitoring during the times that you are in a trade. However, if you are a swing trader, which is one that takes a position or trade in a matter of days or weeks or even months, then you can monitor your trades once or twice daily. And lastly, if you’re an investor, which longer term horizon then you don’t really need to monitor it that often, probably once, twice or three times a week or a month depending on how hands on you want to be with your trade.

      If you have any further questions, feel free to ask. I’ll try to answer to the best of my knowledge.

      Yes, fam did had a wonderful time with our short vacation! Thanks!

  2. Gomer Magtibay

    I don’t exactly remember how I landed here, but one thing is for sure, I am searching for tutorials about forex trading. Something that’s not too technical and can be understood by beginners without background in finance.

    Honestly, reading your article just entertained me. I like your joke, “the trend is your friend until it bends”, but up to now, I still can’t understand what does that mean? Also, the doji candlestick. Do you have other posts explaining these things?

    1. admin

      Good question Gomer. My post essentially assumes the reader has some basic understanding of the world of trading. My apologies if it sounded alien and I guess I missed considering those audience that completely has no knowledge of trading. My bad. 

      You did give me an idea for my next blog, which is to write about the basics of trading and candlesticks patterns. I will do my best to write a good tutorial for trading and candlesticks patterns soon.

      Btw, that wasn’t joke as that is truly a saying that goes in the trading world.

      Cheers!

  3. This is all very new stuff for me. I’m not anywhere near familiar enough with stocks and trading to know what you’re even discussing. I do have a question though, do you use integrals and derivatives solely or do yo have other methods of interpreting your graphs?

    1. Mark

      Hi Nick,

      Short answer to your question, is no I do not use integrals and derivatives. I try to keep my analysis simple as the age old saying goes “KISS” (keep it simple s…on). I mainly use only a handful of strategies, such as trend following, counter trend, support & resistance and price action and a little bit advanced strategies, like Fibonacci, but they’re not really too complicated once you understand them.

      But that’s not to say that I’m not interested with more advanced trading strategies but I take my time to really learn and master one strategy at a time. I am still on the journey as well and learning along the way. Hope that answers your question.

      Cheers!

  4. Kevin

    Very interesting stuff on trends. This subject always keeps me curious. Thanks for putting this together and sharing!

    PS… Looks like you had a blast in Disneyland Hong Kong!

    1. Mark

      You’re most welcome Kevin. I am very much interested in trading myself and as of now I’m focusing on Forex trading, though I have tried stocks and options as well.

      Hong Kong Disneyland was really awesome! My kids and my wife loved it. It was my second time but my first was almost a decade ago. I heard Disneyland in Florida is the best so we’ll likely visit there next sometime in the future. 🙂

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