USD/CAD Forex Signal - 4 January 2016

USD/CAD Signal Update

Last Thursday’s signals expired without being triggered.

 

Today’s USD/CAD Signals

Risk 0.75% per trade.

Trades must be taken from 8am to 5pm London time today only.

 

Long Trade 1

* Go long following a bullish price reversal upon the next touch of 1.3750.

* Put the stop loss 1 pip below the local swing low.

* Move the stop loss to break even once the trade is 20 pips in profit.

* Take off 50% of the position as profit when the trade is 20 pips in profit and leave the remainder of the position to run.

 

Short Trade 1

* Go short following a bullish price reversal upon the next touch of 1.4000.

* Put the stop loss 1 pip below the local swing low.

* Move the stop loss to break even once the trade is 20 pips in profit.

* Take off 50% of the position as profit when the trade is 20 pips in profit and leave the remainder of the position to run.

 

USD/CAD Analysis

I said in my last forecast on Thursday that the long-term upwards trend cannot be said to be over yet, and the strong moves that we have already seen since this year opened in the Forex market have pushed this pair up by 100 pips already in that direction.

This strong move invalidates the bearish trend line and horizontal support that I had drawn on the chart below, confluent at about 1.3916, so we are left only with 1.4000 and 1.3750, although of course there does seem to be a supportive area at around 1.3820 below.

It is probably best to let things settle before entering any trades, but a touch today of 1.4000 could be an excellent opportunity to go short as it would probably fall off very quickly.

USDCAD

There is nothing due today concerning the CAD. Regarding the USD, there will be a release of ISM Manufacturing PMI data at 3pm London time.

Adam Lemon

Adam Lemon began his role at DailyForex in 2013 when he was brought in as an in-house Chief Analyst. Adam trades Forex, stocks and other instruments in his own account. Adam believes that it is very possible for retail traders/investors to secure a positive return over time provided they limit their risks, follow trends, and persevere through short-term losing streaks – provided only reputable brokerages are used. He has previously worked within financial markets over a 12-year period, including 6 years with Merrill Lynch.