Yesterday’s signals produced a nicely profitable long trade from the bullish break of the inside candle rejecting the support level identified at 1.2448.
Today’s USD/CAD Signals
Risk 0.75% per trade.
Trades may only be taken from 8am London time until 5pm New York time today.
Long Trades
- Go long after the next bullish price action rejection following a first touch of 1.2448 or 1.2411.
- Place 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.
- 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 Trades
- Go short after the next bearish price action rejection following a first touch of 1.2541 or 1.2616.
- Place 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.
- 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
Yesterday I forecast consolidation, and this is what we are getting here with this pair. The good news is that there have still been strong and smooth waves within the consolidation area, which has made it very easily tradable. Despite the strong and long-term bearish trend, the price again bounced very bullishly at the support level of 1.2448 yesterday, for the second day in a row. However, also for the second day in a row, the price has so far not been able to break above the nearest resistance level of 1.2541. If it does, that will probably be a sign that the price is beginning a deeper bullish pull-back. As we have already had two touches of both the nearest support and resistance, further touches should be traded with caution, and it is difficult to say what is most likely to happen next.
There is nothing due today concerning the CAD. Regarding the USD, there will be a release of the ADP Non-Farm Employment Change forecast at 1:15pm London time, followed by Preliminary GDP data 15 minutes later, and then finally Crude Oil Inventories numbers at 3:30pm.