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As for today’s trade, we changed it up a bit by taking a USDCAD trade. The markets were moving with intensity all morning so you really needed to be on top of your game when entering a binary option trade. The trade of the day was based on a resistance area using the pivot points. The price had moved up really quick to this level and usually when this happens it has a tendency to consolidate or pullback a bit. In our case the price pulled back pretty much immediately after crossing the line. The strength in the pair allowed the price to move up once again, but in the end the price dropped just enough to give us a winner. Going against the trend has some advantages and disadvantages. Just make sure you know what you are facing when you trade this way.

This post was written a few hours after that video/trade occurred and the price consolidated around that resistance 3 line for about an hour. After that the price dropped pretty significantly back into the daily trading range. Anytime you see these R3 or S3 prices get hit, you know the price is extended for the most part. This being the case, a longer term binary option trade is also a viable option. Something to consider for the future.

Looking at a GBPUSD chart you can see how the price got down to the Support three line only to stay there for about 3 minutes before jumping back up 20 pips.
GBPUSD Pivot Jump

Currencies really like to stay in a steady range. As long as you understand the trading conditions, you can watch trades develop for a reversal at these price levels. Also, remember to consider the ATR (Average True Range) of the currency pair, as a small range the day before may give closer lines of support and resistance. If this is the case, the price may jump pass the R3 or S3 if the Range the day before falls below the latest True Range. These are things we will talk about in the future.

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