Yesterday’s signals were not triggered, as there was no bearish price action at 1.3175.
Today’s USD/CAD Signals
Risk 0.75% per trade.
Trades may only be entered between 8am and 5pm London time today.
Short Trade
Go short after the next strongly bearish price action rejection following the next touch of 1.3281.
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 run.
Long Trades
Long entry after the next strongly bullish price action rejection following the next touch of 1.3168 or 1.3089.
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 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
I wrote yesterday that I would be bearish if we see a bearish retracement following by a strongly bullish reversal at 1.3050 or even the 1.3025 area. Such a retracement did not happen, instead we got a strong and continuous bullish movement, which has taken the price well above the medium-term bearish trend lines which can be seen in the price chart below. We have new higher support levels and the move has been very strong, with the nearest support at 1.3168. I would be bullish today above this level, although it does seem as if the round number at 1.3200 might halt any further advance for a while.
There is major input from the Canadian central bank due later today, so anything might happen later if there is a surprise.
There is nothing due today concerning the USD. Regarding the CAD, there will be a release of Trade Balance data at 1:30pm London time, followed at 3pm by the Bank of Canada’s Rate Statement and Overnight Rate.