USDCAD: Level at 1.3120 looks pivotal today
Last Thursday’s signals were not triggered, as none of the key levels were reached that day.
Today’s USD/CAD Signals
Risk 0.75% per trade.
Trades must be taken between 8am London time and 5pm New York time today only.
Long Trade Ideas
Long entry after the next bullish price action rejection following the next touch of 1.3120 or 1.3045.
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 1.3189 or 1.3240.
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 last Thursday that the best opportunities here were likely to be on the long side, so I was ready to take a weakly bullish bias if we had gotten a bullish bounce at 1.3146 or 1.3120 later. However, I thought the price may be slow to rise much above the round number at 1.3200 for the rest of the week – this was a good call as it reflected what happened.
The technical picture is relatively confused because the CAD is weaker after last week saw the Bank of Canada downgrade its growth forecast, but the USD is also weak. The price does not want to fall below the 1.3045 area but is reluctant to break above 1.3200 also.
Due to the technical picture suggesting ranging behaviour, and the fact that it looks as if today will be a quiet day in the Forex market due to it being Monday and the fact that there is no major news scheduled, it looks as if any support or resistance levels reached today are likely to hold over the day at least. Therefore, I am prepared to take a bias fading a bounce off any key level shown in the chart below.
There is nothing of high importance due today concerning either the CAD or the USD.