Global View vs. Local View

The Question was how far?

US-Dollar v. Canadian Dollar

• The global view is that of the USD/CAD over the past year, but put into the daily time frame
• The local view is a snapshot of this weeks recent advance.
• The comparison is of our notes on both of these time frames
• The question was where do you sell.

The global view 

The yellow zones above indicate where the sellers were likely to pound the USD/CAD.  It is now in zone A, where I first found to be a stretch to achieve but we are now scratching the insides of it.  Frankly, we didn't think it would get this far this fast, but the more recent 400 pip advance is likely what happens with such a volatile currency (CaD tanking like this)

The local view; the blast-off in USD/CAD is to the tune of 465 pips from tough to peak. 

Entered short position at 1.3303

1.33594 stop
1.31 or 1.3095; more concerned about a protective stop than hitting that big of a target

It is the same currency pair with a target below that allows for a very rewarding short position.  We believe it will pull back, at the same time, a pullback of 224-225 pips is a real long shot but anything is possible.  The asymmetric nature of this risk-to-reward set up is appealing because the most that can be lost on a trade like this is 60 pips.