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Bearish Pennant (Flag) Appears on EUR/CAD 4-Hour Chart

July 16, 2017 (Last updated on July 19, 2017) by

Following the surge of the Canadian dollar on Wednesday, July 12, induced by the central bank’s rate hike, the EUR/CAD currency pair has formed a bearish pennant pattern on its H4 chart. Although it resembles a flag pattern, the converging edges make it technically a pennant.

The chart screenshot below shows the pennant formation marked by the yellow lines. The cyan line marks the entry level positioned at 10% of the pennant’s height below the lower border. The green line represents my take-profit level. It is positioned at 100% of the pattern’s height below the lower border. I will set my stop-loss to the high of the breakout candle or to the high of the preceding candle if the breakout one trades mostly outside the borders. I will ignore bullish breakouts from this formation. You can click on the image below to see the full-size chart:

EUR/CAD - Bearish Pennant Pattern on 4-Hour Chart as of 2017-07-16

You can download my MetaTrader 4 chart template for this EUR/CAD pattern. It can be traded using my free Chart Pattern Helper EA.

Update 2017-07-19 5:57 GMT: I had to cancel the trading setup as the price had already broken through the upper border, invalidating the bearish pennant pattern:

EUR/CAD - Bearish Pennant Pattern on 4-Hour Chart as of 2017-07-19 - Post-Cancellation Screenshot

If you have any questions or comments regarding this bearish pennant on EUR/CAD chart, please feel free to submit them via the form below.

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