Last Thursday’s signals were not triggered, as there was no bullish price action at 1.3359.
Today’s USD/CAD Signals
Risk 0.75% per trade.
Trades must be taken between 8am London time and 5pm New York time today.
Long Trades
- Go long after the next bullish price action rejection following the next touch of 1.3359 or 1.3338.
- 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 ride.
Short Trade
- Short entry after the next bearish price action rejection following the next touch of 1.3463.
- 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 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 last Thursday that although nearby resistance was likely to hold for a long time, so would the lows, which had recently been rejected. This pair has been in a long-term consolidation which I thought would continue. I was wrong – we got a strong bearish breakdown, on high volatility – the odds today favour still lower prices. However, there are key support levels close below which may hold, but if the price can break below 1.3200, it can fall all the way to 1.3054 without meeting any support. Traders should be looking at opportunities to ride continuing bearish momentum here, which may run for a few days now if the U.S. Dollar does not make a more significant recovery. Fortunately, the factors which are boosting the greenback seem to also be boosting Crude Oil which helps the Canadian Dollar. I take a bearish bias today but I am cautious of the support at 1.3241 and the fact that 1.3250 is a psychological level.
There is nothing important due today concerning either the USD or the CAD.