USD/CAD Forex Signal

Yesterday’s signals produced a profitable long trade from the bullish pin candlestick which rejected the support level at 1.3339. It is probably a good idea to take profit now as the price looks relatively unlikely to rise much further.

Today’s USD/CAD Signals

Risk 0.75% per trade.

Trades must be entered before 5pm New York time today.

Long Trade

  • Go long after the next bullish price action rejection following the next touch of 1.3339.
  • 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 1.3402 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.

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USD/CAD Analysis

I wrote yesterday that the price had become established within a symmetrical medium-term bearish channel, meaning that the confluence of the trend line, resistance and round number at 1.3400 made that an attractive area at which to find a short trade after a bearish reversal.

The price never got there, taking an opposite direction and instead bouncing bullishly at the likely support level which I identified correctly at 1.3339.

Despite this bullish move, the overall technical picture remains the same, and I would still be looking for a short trade after a heathy bearish reversal at 1.3400, especially if 1.3402, the round number, and the trend line slightly below that are all rejected at the same time.

usdcad

There is nothing important due today concerning either the CAD or the USD.

Adam is a Forex trader who has worked within financial markets for over 12 years, including 6 years with Merrill Lynch. He is certified in Fund Management and Investment Management by the U.K. Chartered Institute for Securities & Investment. Learn more from Adam in his free lessons at FX Academy.