EURCAD: Pontential +100 pip trade

Confluence
We can clearly see a well-tested resistance area on the 4-hour chart a potential spot to take a short position. I am still waiting for confirmation in this area and therefore I will not trade this area blindly. Another confirmation is the fact that the RSI is overbought + it is that in a key resistance area. The last factor is the potential head and shoulder pattern forming itself.

COT - The hedge funds
If we look at the COT reports for the Canadian dollar, we can clearly see an increase in net positions from -17.560 to 18.574. We can’t see the biggest move in net positions from a EUR perspective but a small decrease in net positions from -100.789 to 103.401.

If we look at the overall short positions on the EUR is 159.127. Overall long positions on the CAD are 51.738 which is more compared to the short positions. So, a push to the downside on the EURCAD will not be a huge surprise if we get more confirmations around this area of resistance.

CAD COT: tradingster.com/cot/futures/fin/090741
EUR COT: tradingster.com/cot/futures/fin/099741
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