USD/CAD Forex Signal - 10 May 2017

Yesterday’s signals were not triggered as there was incorrect price action at both the key levels which were reached.

Today’s USD/CAD Signals

Risk 0.75% per trade.

Trades may only be entered between 8am London time and 5pm New York time today. 

Long Trade 1

  • Long entry after the next bullish price action rejection following a first touch of 1.3675.
  • Put the stop loss 1 pip below the local swing low.
  • Adjust the stop loss to break even once the trade is 20 pips in profit.
  • Remove 50% of the position as profit when the trade is 20 pips in profit and leave the remainder of the position to ride.

Short Trades

  • Short entry after the next bearish price action rejection following a first touch of 1.3745 or 1.3791.
  • Put the stop loss 1 pip above the local swing high.
  • Adjust the stop loss to break even once the trade is 20 pips in profit.
  • Remove 50% of the position as profit when the trade is 20 pips in profit and leave the remainder of the position to ride.

The best method to identify a classic “price action reversal” is for an hourly candle to close, such as a pin bar, a doji, an outside or even just an engulfing candle with a higher close. You can exploit these levels or zones by watching the price action that occurs at the given levels.

USD/CAD Analysis

I wrote yesterday that “Bulls should be encouraged, but the broken bullish trend line which held as resistance during the New York session could remain a resistant obstacle over the short term.” This is more or less how things turned out, with the price initially rejecting the resistance at 1.3746, before falling a few pips below the support and turning bullish again. It might remain difficult for the price to rise significantly, but the outlook is reasonably bullish, supported by the long-term trend, although I would still be very cautious of the resistance levels marked in the chart below.USDCAD

There is nothing due today concerning the CAD. Regarding the USD, there will be a release of Crude Oil Inventories at 3:30pm 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.