USD/CAD Elliott Wave Count for May 16, 2012

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USD/CAD Elliott Wave
Yesterday the USD/CAD pair was trading in an upward movement. During the early European session we could observe the descending move towards the 0.9992 level. The USD/CAD pair did not manage to hold this level and price start pushing slightly higher during the second half of European session.Therefore during the New York session the USD/CAD pair test 61.8% level of wave 1 at 0.9990. We can consider this move as end of the 2 wave (coloured blue). After we saw end of the 2 wave price started pushing higher in the 3 wave and reached new daily high at 1.0070 level. Today during the Asian session we could observe the continuation of the bullish mood and price touching 1.0130 level. Presently we can observe end of the 3 wave. In accordance with our wave rules and taking into account that the wave 3 retraces 261.8% of the wave 1, we can define the potential targets with Fibonacci extensions (0.9953-1.0050-0.9990) with Take Profit 1 at 1.0179 (200% of wave 1) and Take Profit 2 at 1.0238 (261.8% of wave 1). The support level at 1.0080 level can be used as Stop Loss. Also it is necessary to consider the data concerning the U.S Building Permits, Housing Starts, Capacity Utilization Rate, Industrial Production m/m, Crude Oil Inventories,FOMC Meeting Minutes and CAD Manufacturing Sales m/m that can affect the rate of the pair.
Support and Resistance levels
(S3) 0.9960 (S2) 0.9992 (S1) 1.0012 (PP) 1.0044 (R1) 1.0076 (R2) 1.0096 (R3) 1.0128
Trading Forecast
Proceeding from Elliott Wave Rules this week the trend is expected to begin the upward movement. That is why Long positions at level 1.0120 with Stop Loss at 1.0080, Take Profit 1 at 1.0179 and Take Profit 2 at 1.0238 are recommended.