Last Thursday’s signals were not triggered, as none of the key levels were reached during that day’s session.
Today’s USD/CAD Signals
Risk 0.75% per trade.
Trades must be taken between 8am and 5pm New York time today only.
Short Trade
Go short after the next strongly bearish price action rejection following the next touch of 1.2884.
Put 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.
Remove 50% of the position as profit when the trade is 20 pips in profit and leave the remainder of the position to run.
Long Trade
Go long after the next strongly bullish price action rejection following the next touch of 1.2750.
Put 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.
Remove 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 break above the former resistance level at 1.3011 was is a bullish sign and so I took a bullish bias that day. This was a fair call, as the price rose quite a lot further before topping out just below the nearest resistance. However, from that moment, this pair has fallen very sharply and strongly, painting a much more bearish picture. This has been caused by the surge in the price of Crude Oil which pulls up the Canadian Dollar as Canada is a leading oil producer. Despite the bearishness, over the short-term there are signs that the price is bottoming out and will now make a bullish retracement. I see a short trade at a bearish bounce at the nearest resistance as the best potential trade set-up.
Regarding the USD, the Chair of the Federal Reserve will be giving a minor speech at 3pm London time. There is nothing due today concerning the CAD.