Alagbe Simon analyzes USD/CAD on April 1, 2020, using Fibonacci levels and two upcoming U.S. data releases: ADP employment at 1:15 PM and ISM Manufacturing PMI at 3 PM, both expected to miss forecasts and weaken the dollar. He sets up two trades: a buy-stop around 1.42739 for 10-15 pips, and a sell-stop near the 23.6% level targeting 20-30 pips.
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Good day, welcome to Rally Academy's daily market analysis. I am Alagbe Simon, a financial educator with Rally Academy. Today, the 1st of April in the year 2020, we would be examining trade opportunities on USD/CAD. So let's take a look at the USD/CAD charts on our MT4. So this is the USD/CAD chart On the MT4, taking a look at this, this is on the four hours chart. We would see that at a time USD card was at this very low point, then it surged so high up until this point, then started a form of retracement up to this particular point. So for us to be able to measure the retracement on USD card at this time, I will pick my Fibonacci retracement. And I will draw from the recent low, which is around this side, to the recent high in sight, which is at this point. So I can then zoom it in so that we'll be able to see it clearly. We would see that, um, USD/CAD dropped at this point, struggled with the 23.6 Fibonacci level broke below, then came back before eventually breaking through here, and then was eventually stopped by the 50% level. So it got back to retest the 23.6, then came down to 38.2, and at this time is trying to reapproach and retest the 23.6 Fibonacci retracement level. This instrument today, there are still some economic data that will also influence movements on this instrument. There are some economic data that will still influence movement on this instrument for today. By 1:15 PM, we're expecting the ADP non-farm employment change. The last time this data came out, it was far better than forecast as 183,000 persons were employed. outside the farming industry as against 270,000 that was predicted. But this time around, owing to the fact of, um, the unemployment claims that were— was released last week, about 1.6 million persons were expected to file for jobless claims last week, but 3.2 million persons filed for jobless claims last week. So this particular data is already giving us a pointer that ADP nonfarm employment change by 1:15 PM today would likely come out below the forecast. The forecast is around -150,000, so that's— that should— there should be some job cuts to the tune of 150,000, so it might come out far lower than this 150,000 job cut. So let's be on the lookout for this particular data by 1:15 PM. And also ISM Manufacturing PMI would be coming out by 3 PM. So as we are trading USD/CAD today, also have to pay attention to these 2 crucial moments on this particular instrument, 1:15 and 3 PM today. Very crucial economic data. That might change the direction on this instrument. But let's look at the setup at this point in time. So we still have some slight opportunity between where we are to this 23.6, um, percent level to make some money on the buy. But if we are looking at this setup, we would see that this setup— there is more room for us to make money off a sell Considering the expected economic data later today, those that are expected to— those that are expected to come out far below forecast, which should weaken the dollar as at that time. So owing to that fact, we should be targeting the opportunity to make money off selling USD/CAD at any point from now. So if you are looking at opportunity to sell USD/CAD, um, this is USD/CAD still approaching the 23.6. And if we measure this point where USD/CAD is to the 23.6 level, we have about— it's about 59 pips away. So which means we can still even make some money off the buy pending the time that the economic data will be released. So if you want to make some money off this buy, we should be looking at a point above this last candle, which is somewhere around this price level. So should be looking at having a buy stop around this price level and our take profit slightly before this 23.6% Fibonacci retracement level. So how do we set a pending order to be able to take advantage of the movement from this point up until the 23.6 level? We come to New Order, we change the type of execution from Instant to Pending Order. We are going for a buy stop because we're expecting it to get here and then continue the bullish movement up until this 23.6% Fibonacci level. And owing to the fact that we're expecting some very key fundamental data by 1:30, so it's good for us to also set an expiry time for this trade because of the expected economic data by 1:30 our own local time. But owing to the server time, the server time is 1 hour ahead of our local time. So that means you have to add an extra hour to the server time for us to get the expiry time for our trade. Because if this order is not triggered before the economic data expected, we should be expecting US dollar to trade lower when the data comes out. So how do we go about that? We want to set a pending order. Uh, a buy stop. So change this to buy stop, and the price level is 1.42739. And then expiry time currently is 13 o'clock, and the data will be released in an hour's time, 1 hour time. So that's 13 plus 1, that will give us 14. So by 14:25, if USD/CAD is yet to get to this point, then our trade, this particular setup, will be null and void. So let's have the trade set up. Okay, so our pending order has been successfully placed. If by 1:25 USD/CAD is yet to get to this point, then our trade will be null and void. So we also need to set our take profit on this trade. It should be slightly before this 23.6 level. We'll click and then modify or delete order. We enter our take profit point 10 pips or 15 pips away from this entry point. 1.4242839. That's 10 pips away from our entry point, but the favorite direction on this pair by virtue of the expected economic data in the next 1 hour is still a sell trade. And, um, we should be targeting this point slightly below the last— the low of this last candle, with our take profit before this 38.2 Fibonacci retracement level. So we have a lot of room to make money on the sell trade compared to the buy trade. That's around 102 pips, but we can just target about 20-30 pips from this point. So we use a sell stop from this point level for the sell trade. The sell stop, depending order, then we select sell stop at price 1.1420. 9, 7. 1.142, 420, 9, 7. So we would place the trade from that point. So we have the sell stop from this price level owing to the fact that the expected economic data from the US later today we come out negative. So we should be looking at, um, taking the opportunity of that by having this sell stop trade at this price level. Thank you for listening, and, um, do make some pips from USD/CAD today. Happy New Month once again.
