USDCAD is very over extended on both the Daily and Weekly timeframe. We are going to look for a countertrend trade to the Daily/Weekly which will be a trend trade on the lower timeframe. Since this is countertrend, we are going to get out with a profit.
The Timeframe we are going to trade is the 1h. Entry is going to be 1.0299 with a initial stop of 1.0382. This 83 pips risk roughly but will be different when we enter the trade since it is a breakout trade. Our stop is going to be the green dots on the screen which will move when we enter the trade.
The Preserve mode value is going to be 1.0233. This is where we are going to “protect” our profits and tighten our stop. The target is going to be 1.0157. The reward we are targeting is roughly 150 pips. This is close to 2:1 reward/risk. On entry, it will be become 2:1 since the stop will change.
If price goes to 1.0378 before entry, we will cancel the trade since the setup will not be good anymore.
Note: This trade is for aggressive traders since it is a countertrend trade.
Here is a chart on everything. To learn more about Ichimoku, please go to www.ichimokutrade.com
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