USD/CAD Forex Signal - 1 February 2018

Yesterday’s signals were not triggered, as none of the key levels were ever reached.

Today’s USD/CAD Signals

Risk 0.50% per trade.

Trades may only be taken until 5pm New York time.

Long Trade

  • Long entry after the next bullish price action rejection following the next touch of 1.2219.

  • 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.

  • 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 Trades

  • Short entry following a bearish price action reversal on the H1 time frame immediately upon the next touch of 1.2400, or the bearish trend line shown in the price chart below at 1.2377.

  • 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.

  • Take off 50% of the position as profit when the price reaches 20 pips in profit and leave the remainder of the position to run.

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

Again, the technical situation remains the same, with a bearish outlook but without especially strong movement. A new bearish trend line is drawn in the price chart below, linking key swing highs, which might provide a short trade entry opportunity after a bullish pull back. It would be a third touch, which tend to provide the best opportunities from rejections of trend lines. I have a slight bearish bias.

USDCAD 

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

Adam is a Forex trader who has worked within financial markets for over 12 years, including 6 years with Merrill Lynch. He is certified in Fund Management and Investment Management by the U.K. Chartered Institute for Securities & Investment. Learn more from Adam in his free lessons at FX Academy.