UsdCad To Take A Rest?

On 31st May, there was analysis here titled Multi Face Analysis of the Usdcad. 

After the analysis, I put a sell order. 

 

I was so sure that I was selling after the completion of a long term flat formation on the weekly chart which was confirmed by the 5-wave impulsive move. 

Price was expected to break below 1.90 in a motive mood.

Price did react and fell, hit my first target at 250pips, then rallied and took 1.23 up in an impulsive manner. 

After looking at the preceding dip from 1.256 to 1.212 and saw how fast the advance was, i quickly exit my second position at a profit of 60 pips. 

The dip was zigzag correction. I didn't trade it because it doesn't tick all my boxes. I only used it as a precautionary measure to close a winning position before running to loss.

 

 Elliot wave theory helps to maintain a winning edge by giving us a clue on how price should response to every pattern it forms, not in a perfect way.

The advance from 1.2125 was an impulsive move with the third wave breaking above 1.28 resistance for more movement upward to 1.316.

 

The third wave is a textbook 5-wave pattern to which price is expected to react, if the support neckline of the terminating upward congestion is broken downside, and dip to 1.28 support in a congestion manner (probably a triangle) typically seen wave 4. 

 

A rally is now expected to terminate the whole upward move after which one can be expected to trade end of 5th wave reversal.

Wave 4 dip is expected to be limited at 1.265 or above 1.256. Any dip below 1.256 could spell bearish resumption.