Canadian Dollar Enters Support Zone

The latest Canadian Dollar decline, which started 10-1-18, is now trading inside a Fib support zone. This zone is calculated by taking the 261, 361, and 461 extensions of the dominant and 1st level supporting measured moves. This range starts at 7547 and extends down to 7333. This tells me that theres a significant chance of a substantial rally starting inside this zone. If a low does indeed form, then theres a 69% chance of a 38% retracement rally, a 57% chance of a 50% retracement rally, a 48% chance of a 62% retracement rally, a 36% chance of a 78% retracement rally, and a 26% chance of a 100% retracement rally. However, the 214-point Fib support zone is too large for a favorable reward/risk trade. It needs to be narrowed down. Thats when I look for additional supporting measured moves to help create more Fib extensions inside the main support zone. The 2nd level supporting measured move does just that by narrowing the zone of focus to 7500-7360. Its inside this 140-point area that I will start to look for additional clues of this market bottoming out.