USD/CAD Forex Signal - 14 May 2019

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Yesterday’s signals were not triggered, as the bullish price action took place below 1.3432.

Today’s USD/CAD Signals

Risk 0.75% per trade.

Trades may only be entered from 8am London time until 5pm New York time today.

Long Trade

  • Long entry after the next bullish price action rejection following the next touch of 1.3447.
  • 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.

Short Trade

  • Short entry after the next bearish price action rejection following the next touch of 1.3529.
  • 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 although the price had recovered and possibly even established new higher support at 1.3432, this bullishness looked very vulnerable to me. The price was back within its long-term consolidation area, and until the bulls could push the price up to stick above 1.3500 or (even better) 1.3529 I would stay away from taking any trades in this currency pair.

This was partially a good call as this support level at 1.3432 was easily broken, but the price subsequently rallied to end the day higher.

The technical picture is muted bullishness – the price needs to break above 1.3529 and the longer it refuses to fall below the price range shown within the chart below, the more likely such a bullish break is to eventually happen. For now, it is probably best to stand aside, or buy on a dip to 1.3376 with a small position.

I would take a bullish bias if the price can end a day above 1.3529.

usdcad

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

Adam Lemon began his role at DailyForex in 2013 when he was brought in as an in-house Chief Analyst. Adam trades Forex, stocks and other instruments in his own account. Adam believes that it is very possible for retail traders/investors to secure a positive return over time provided they limit their risks, follow trends, and persevere through short-term losing streaks – provided only reputable brokerages are used. He has previously worked within financial markets over a 12-year period, including 6 years with Merrill Lynch.
Learn more from Adam in his free lessons at FX Academy