The interest rate hike came as a surprise but we should not be shocked by the strength of the Canadian dollar . Against the USD on the daily and weekly charts there is a clear , showing clear optimism for the currency. (See idea below, logged 8 months in advance). The Cad has gained value across the board against all currencies.
The Euro in the past couple of months has also seen sound growth. When comparing this to the value of the Canadian Dollar we may see this pair heading into some consolidation before either currency gains more momentum.
Due to the nature of the pattern, there is no key singular entry price for any trade. Instead we have a reversal ZONE. Our C:D wave must be between 1.618-2.24 the distance of B:C, while the complete retracement between X:D must land between 88.6% and 113%. Taking this into account, I have identified the minimum and maximum entry levels for a long position- see bold horizontal lines. An entry can be taken at any point on/between these levels. As per the distance between the entry and TP levels, the lower price will give us a far greater return- I will wait for price to reach this level before looking into taking a position. As the pattern has the same ratios as a , we adjust our TP level to accommodate for a potential reversal. See ratios below:
A:C = 1.13-1.618
B:D = 1.618-2.24
X:D = 0.886-1.13