Yesterday’s signals were not triggered, as none of the key levels were ever reached.
Today’s USD/CAD Signals
Risk 0.75% per trade.
Trades may only be taken before 5pm New York time today.
Short Trade
Go short after the next bearish price action rejection following the next touch of 1.3464.
Place 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 trade is 20 pips in profit and leave the remainder of the position to ride.
Long Trades
Go long after the next bullish price action rejection following the next touch of 1.3324 or 1.3261.
Place 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 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 the standout feature here was the cluster of resistance levels around the psychologically important level of 1.3500, which could provide an interesting short trade opportunity if reached. I had no directional bias and thought that there were likely to be better opportunities elsewhere today. This was a good call as the price fell instead of continuing its medium-term bullish trend. It is starting to look like the former bullishness has really ended and the price is sinking back into a consolidative and unpredictable area. The bulls may have one last shot which could be revealed by a strong bullish reversal at either of the two key support levels below – I would take a bullish bias later if we got a strong bounce at one of those.
There is nothing important due today concerning either the CAD or the USD.