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 entered prior to 5pm New York time today.
Long Trades
Go long after the next bullish price action rejection following the next touch of 1.3241 or 1.3204.
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 bearish price action rejection following the next touch of 1.3369 or 1.3389 or 1.3470.
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 the price was in a consolidating triangle. I thought that it was likely to break lower rather than higher but that probably would not happen until the FOMC release later in the week. I was partially correct: the chart below shows that it broke lower, but the break was very temporary, and the price has recovered to get back into the area it was in before.
There is no trend and the situation seems finely balanced between bulls and bears over the medium and long terms, but the short-term price action is bullish. I can’t make any call on this now but volatility has been relatively high recently so the FOMC release tonight is likely to provoke some action, and this pair will probably also be moving more than most of the market pre-FOMC.
There is nothing of high importance due today concerning the CAD. Regarding the USD, there will be releases of the FOMC Statement, Economic Projections, and Federal Funds Rate at 6pm London time, followed by the usual press conference half an hour later.