Yesterday, my colleagues and I were focusing on Canadian pairs. Thanks to the Bank of Canada, both of our forex trading ideas hit take profit. However, we are going to encounter the echoes of Canadian interest rate hikes. Check out my next plan…

As mentioned in "Trade Setups In Canadian Crosses – BOC In Focus", the Canadian crosses were trading in the oversold regions, perhaps, the expectations of the interest rate hike were clicking their minds.

CADCHF – Second Entry In The Pair

As of now, the pair has completed the 38.2% Fibonacci retracement at $0.7801. Yet, the momentum indicators in the 4-hour timeframe are trading in the overbought zone.

CADCHF – Triangle Breakout – 4 Hour Chart 

The Stochastic & RSI are holding at 88. This means that prices are already at their peak and bulls may take profit on their previous positions. For now, $0.7800 is an immediate support and the break below this level will lead CADCHF towards $0.7762 (potential buying level).

CADCHF – Trading Plan

We need to wait for the pair to complete 61.8% retracement at $0.7760 before entering a buy position. You must be wondering, why don't we take a sell position to capture 40 pips? Well, the pair is fundamentally bullish and I don't want to get stuck in anti-trend trade.

Remember, the trend is our friend.  Stay tuned, I'm working on Euro crosses today and it will be up shortly. Good luck for today!