Yesterday’s signals were not triggered, as there was no bullish price action at 1.3003.
Today’s USD/CAD Signals
Risk 0.75% per trade.
Trades may only be taken between 8am London time and 5pm New York time today.
Short Trade
Short entry after the next strongly bearish price action rejection following the next touch of 1.3118.
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 ride.
Long Trade
Long entry after the next strongly bullish price action rejection following the next touch of 1.3003.
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 ride.
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 it looked technically likely that the price would fall further now, with no longer-term trend to provide direction. However, the Bank of Canada were providing their monthly input later, which was liable to cause volatility and unpredictable price movement, so I had no bias as to yesterday’s direction. The Bank of Canada raised their growth forecast, and this means the market now sees more rate hikes as more likely to occur, so the price moved down quite strongly, invalidating the support level at 1.3003, and this was in line with the technical picture which I identified. There is more life in this pair now, and it looks more likely that the price will move down over the course of today than up, at least until the support level at 1.2962 is reached. There is no long-term trend in this pair to exploit.
There is nothing important due today concerning the CAD. Regarding the USD, there will be a release of Core Durable Goods Orders data at 1:30pm London time.