USDCAD: Weakly bullish within long-term range
Yesterday’s signals were not triggered, as there was insufficiently bearish price action when 1.3308 was reached.
Today’s USD/CAD Signals
Risk 0.75% per trade.
Trades may only be entered before 5pm New York time today.
Long Trade Ideas
Go long after the next bullish price action rejection following the next touch of 1.3271 or 1.3236.
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
Go short after the next bearish price action rejection following the next touch of 1.3308, 1.3345, or 1.3359.
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 the price action was very weakly bullish but that there were major news events due for both currencies which could push the price anywhere. Until those releases, I thought that the level at 1.3236 would be likely to hold up. This was a good call, as it did hold.
The picture is still weakly bullish, with the price rising but bulls unable to push it beyond the resistance level at 1.3308.
Despite the medium to short-term bullish picture, over the long-term the price is still ranging. The price really needs to gest established above 1.3359 to generate a truly bullish picture and as such, I think that resistance level and the one near it will be interesting as a very pivotal point if it is reached. If hit today with a failure to break, it would probably be a good short trade, so I would take a bearish bias if we get a bearish reversal there later.
There is nothing of high importance due today concerning the CAD. Regarding the USD, there will be a release of Philly Fed Manufacturing Index data at 1:30pm London time.