Canadian dollar moves lower in triangle: Elliott Wave

The Canadian dollar reversed lower against the U.S. dollar at the end of last week from a trendline connected from July highs, which suggests that the rally from 1.0180 was corrective a leg. If that is the case, then the pair could be forming a bigger and more complex correction than we first thought. We are now observing the idea of a triangle with wave E underway back to 1.0300. This will be a final leg in the pattern, so be aware of a bullish period after completed pattern.

USD/CAD Elliott Wave Daily

On the 4h chart, USD/CAD has turned bearish at the end of last week after a broken trendline connected from Oct. 22 low. This break suggests that the rally from 1.0180 was a complex double zigzag, labeled as (w)-(x)-(y) which is a corrective move that represents a wave D that is part of a larger triangle pattern. If that is the case then the pair is now moving down for a three wave decline in wave E, a final leg of a pattern that may look for a support around 1.0240-1.0280.

USD/CAD Elliott Wave 4h

Elliott Wave Education:  Triangle Pattern

A Triangle is a common 5 wave pattern labeled A-B-C-D-E that moves counter-trend and is corrective in nature. Triangles move within two channel lines drawn from waves A to C, and from waves B to D. A Triangle is either contracting or expanding depending on whether the channel lines are converging or expanding. Triangles are overlapping five wave affairs that subdivide 3-3-3-3-3.

  • structure is 3-3-3-3-3
  • each subwave of a triangle is usably a zig-zag
  • wave E must end in the price territory of wave A
  • one subwave of a triangle usually has a much more complex structure than others subwaves
  • appears in wave four in an impulse, wave B in an A-B-C, wave X or wave Y in a double threes, wave X or wave Z in a triple threes
About the Author

Gregor Horvat, based in Slovenia, has been in the forex markets since 2003. He is a technical analyst and individual trader who has worked for Capital Forex Group and He also is founder of forex services on provides technical analysis of the financial markets, highlighting behavioral patterns based on the Elliott Wave Principle (EWP). Website:

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