Quote:
Originally Posted by cas
When you look at the intermarket relationship with crude oil, USD/CAD & CAD/JPY pairs you will find that the USD/CAD & CAD/JPY pairs have moved the exact same amount of pips in it's opposite direction while crude oil has been falling since NY open.
The CCI reading in the USD/CAD pair and Crude Oil are identical in it's opposite direction eg. USD/CAD is rising and Crude Oil is falling.
That indicates that there has been volume moved into the USD/CAD pair in order to hedge against a falling crude oil price which caused the USD/CAD pair to move up from it's 1.1026 - 1.1036 S&R level temporarly.
The point I am trying to bring across here is...that it is not sufficent to look at S&R levels alone. If you [wish to] trade USD/CAD you need to keep an eye on Crude Oil price action and volume movements into the USD/CAD pair.
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Good Analysis. Thank you !! Its always useful to know that which of the pairs related either in the same direction or in the opposite direction.. It's easy to analyze the pairs in conjuction sometime rather than focussing on one.. It can also be used as a confirmation for trade setups. In fact, I am looking at CADJPY to cross the on the daily chart at 86 level.. which is a head & shoulder formation. On breaking this line, I expect that it will hit 89 level.. FYI.. Please see the attachment ..