USDCAD: Still weakly bullish
Yesterday’s signals produced a nicely profitable long trade from the bullish inside candlestick break on the hourly chart which rejected the support level identified at 1.3251. It would probably be wise to exit the remainder of this position at profit right away as the price is hitting new resistance.
Today’s USD/CAD Signals
Risk 0.50% per trade.
Trades must be taken from 8am London time until 5pm New York time today.
Long Trade Ideas
- Long entry after the next bullish price action rejection following the next touch of 1.3286 or 1.3251.
- 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 run.
Short Trade Ideas
- Short entry after the next bearish price action rejection following the next touch of 1.3345 or 1.3365.
- 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 run.
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 I still saw hope for bulls to catch an entry into this weak bullish trend at a pull back to 1.3286 or even 1.3251, provided there was a solid bullish bounce at either level when it was reached. This was a great call as we got such a bounce at 1.3251 which gave a profitable long trade.
The picture now is still weakly bullish, but we are getting lower resistance at 1.3314 which is a bearish sign, as well as lower swing highs. This suggests that the direction is becoming less predictable and a period of consolidation more likely to begin soon.
However, I would still look towards the long side due to the long-term (but weak) bullish trend and the general strength of the greenback.
There is nothing of high importance due today concerning either the CAD or the USD.