Currency Pair: EUR/CAD
Time Frame: Daily chart , 4-hour chart
Long or Short: Short
Entry Point: 1.2920
Stop Loss: 1.3010 (Above round number 1.3)
Profit Target/s: 1.2780 (Near last swing low)
Reward-to-risk Ratio: 1.56/1
Risk percentage: 0.9%
Indicators used: Trend Line , Slow Stochastic
* Fundamentally : Although the EU Summit results were relatively good , 120B Euro growth plan and direct bank recapitalization but that doesn’t change the situation for EZ I mean structurally nothing has really changed and it always takes time for these measures to get implemented .Also with expectations of rate cut decision in ECB meeting next Thursday .I think Euro will move lower next week . On the other side the last data released on Friday showed that the Canadian economy expanded at a faster pace than expected in April printing 0.3% mom growth and 2% yoy . Based on weak/strong analysis i think it is time to short the pair.
*Technically : On Daily chart the pair is testing the down trend line from April and also stochastic has cleared the oversold condition opening the door for more down move in coming days.
On 4-hour chart there is bearish divergence which confirm the trade idea.
Trade Adjustments: I will move my stop to BE when I am up 90 pips.
So what do you think ?