EUR/CAD 16.12.2016 D1 chart.
Downtrend and sharp short term downward movement.
The week began with a gap in direction of the downward movement, which increases the likelihood for the negative sentiment to remain.
Price action: Inside bar, false break in upward direction and bearish engulfing bar - negative formation - sell
Technical indicators:
SMA50 is below SMA200 as there was a death cross - sell
DeM(14) crosses back below 0,3 - probable new downward impulse
We can wait for a little correction around 1,3940 to minimize risk.
SL 1,4075
Alternative scenario: If price breaks above 1,4030 (at least 3 closed bar above), then the negative formation will cancel and we might see a new upward movement.
Jr. Trader Nikolay Georgiev
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