Currently, GBP is in a bearish pressure around the board. We will monetize this bearish pressure on the GBPCAD pair. For this, we will analyze H4 for intra-day and swing trade.

- Market structure: Market structure on GBPCAD is still bearish on a higher time frame. Unless it breaks the 1.7420 level, it seems to be pushing further down. The resistance market is it is also a supple zone, where many sell orders are set. To have minimum risk, it is better to wait for the 1.7450 level, where we will have minimal risk to take a short.

- Trendline: There are three trendlines in play on GBPCAD. First we had an ascending trendline, which was broken and market is retracing to the validation of it. Second, we have a descending trendline, which has also been pierced but stalled at the resistance. Hence, the structure wasn’t changed after the breakout buy and GBPCAD still remains bearish. 
Thirdly, we have a resistance trendline test at the current market levels. This test also confluences with the oscillator resistance trendline, hence forming a hidden divergence.

- Retracement: The golden retracement level of 75-78.6% aligns with the resistance level and is at a price point of 1.7450. Given the resistance level is also a supply zone, the retracement level will play out strongly.

- EMA's: Both EMA’s are bullish at the moment. The EMA’s were pierced by the candles and have not yet been retested. Either the pressure build from the resistance will break the EMA’s or it may retest and push back up for another retest. No confluence is formed with EMA’s for now.

- RSI/CCI: Both oscillators are in the bullish region. RSI is at 64 and CCI at 150. CCI is forming a hidden divergence in lieu with the price action. This divergence has already started to take the impact, with further anticipation of falling down.

GBPCAD has 3 confirmations for sell. Given that the resistance area is strong and also a supply zone, there is a high probability for GBPCAD to turn bearish.

GBPCAD shorts from 1.7420

Aug 16 2021

Stop Loss -0.28%

Holding time 8hr

1.74400

Entry price

1.74880

Stop loss price