Current market conditions for the AUDCAD currency pair present a potential opportunity to those who prefer trading rebounds from the limits of an equilateral channel. On the H4 timeframe, a clear uptrend has been forming since the second half of July. So far, the price has tested the channel’s lower boundary four times. The pair could take a few more attempts to breach this level before eventually targeting the upper limit. However, an alternative scenario is also probable, with AUDCAD breaking below the support area and dropping under 0.8860. Meanwhile, the chances that the quotes continue to move within the channel will be increased if a bullish reversal pattern is built near its lower boundary. This formation might be similar to a “head and shoulders”, with a neckline in the 0.8930–0.8940 range. A breakout above this zone could trigger upward momentum.
However, this strategy also carries some risks. No consolidation lasts indefinitely, and the price will eventually exit the channel. Predicting the exact timing of this breakout is difficult. Therefore, a protective Stop Loss order is essential to manage risk, particularly if the bearish scenario materializes.
The overall recommendation is to buy AUDCAD within the 0.8920–0.8940 price zone. Profits should be taken at the level of 0.9030. Stop Loss could be set at 0.8860.
The volume of the open position should be calculated so that the potential loss (protected by a Stop Loss order) does not exceed 1% of your deposit. If your account balance does not allow opening a position of this size, it is better to avoid entering the market on this signal and wait for other trade options that meet low-risk criteria.
This content is for informational purposes only and is not intended to be investing advice.
