The Canadian Dollar (CD) has been just as strong as the Euro this year, and I've been watching it as a leading indicator for a Euro reversal. A reversal bar has formed on the weekly chart, but there is no sell signal on the daily yet. The hourly longs were closed last Thursday after moving straight up for nearly a month. It's important to watch the trends in different time frames.

I always look at the weekly, then the daily, then the hourly, and lastly the ten minute chart. You need to be aware of the trends in the time frames above the one that you're trading. You could get short the CD on the hourly with a protective stop at .7430, but you'd have to be aware that you're fighting both the weekly and daily trend. Trading against the trend while anticipating a major reversal isn't necessarily a bad idea as long as you keep a tight stop.

Previous Entry >>> Visit to Windsor