USD/CAD Range Setup (June 3, 2013)

The pair is currently moving sideways on its 1-hour time frame, as it found support around 1.0300 and resistance near 1.0400.

The pair gapped up over the weekend, but the gap has already been filled. Stochastic is still climbing, which shows that there’s still enough buying pressure to trigger a test of 1.0400.

Set a stop beyond the pair’s previous highs to give the trade enough breathing room. Aiming for the 1.0300 bottom of the range could still be a 2:1 trade with a 50-pip stop.

The U.S. ISM manufacturing PMI is the only red flag for this pair today, and the report is expected to tick lower from 50.7 to 50.6.

By Kate Curtis from Trader's Way