Yesterday’s signals were not triggered, as there was no bullish price action at 1.3324.
Today’s USD/CAD Signals
Risk 0.75% per trade.
Trades must be entered between 8am and 5pm New York time today only.
Long Trades
Go long after the next bullish price action rejection following the next touch of 1.3261, or 1.3214.
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.
Short Trades
Go short after the next bullish price action rejection following the next touch of 1.3324 or 1.3367.
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.
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 it looked as if the price may still fall further, but perhaps not by much. I was ready to take a bearish bias after a pull back to a resistance level followed by a bearish reversal, but it didn’t happen, at least not to any resistance level that I had identified correctly.
We see strong bearish momentum with a really large fall over the past few days, caused by weakness in the U.S. Dollar and new strength in the Canadian Dollar, boosted by Crude Oil, with the price breaking and holding below yet another support level. I would like to be bearish, but the momentum is slowing and there is key Canadian data due later which makes today’s short-term price movements unpredictable. It may be that if the data is strong, the price would make another healthy fall.
Again, I would take a bearish bias if there is a strong reversal at any of the identified resistance levels after the data release.
There is nothing of high importance due today concerning the USD. Regarding the CAD, there will be a release of Trade Balance data at 1:30pm London time.