Last Thursday’s signals were not triggered, as neither of the key levels were reached that day.
Today’s USD/CAD Signals
Risk 0.75% per trade.
Trades may only be taken between 8am London time and 5pm New York time today.
Short Trade
Go short after the next bearish price action rejection following the next touch of 1.3235.
Put the stop loss 1 pip above the local swing high.
Move 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 Trade
Go long after the next bullish price action rejection following the next touch of 1.3055.
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.
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 last Thursday that the best that could be said was that there may be some support at about 1.3240. For that reason, I saw no opportunity here, and would avoid trading this currency pair today. That was a good call as the price did little here that day.
The picture now is much more interesting, with markets moving decisively into “risk on” mode, putting the U.S. Dollar into descent and Crude Oil has come roaring back. This has pushed the price down quite strongly, and the break below the support and the bullish price channel is a decisively bearish technical development. It may be that a pull back to 1.3183 later could provide a nice short trade entry. I take a bearish bias today below that level.
There is nothing important due today concerning the CAD. Regarding the USD, there will be a release of ISM Manufacturing PMI data at 3pm London time.