Yesterday’s signals produced a losing long trade from the bullish engulfing candlestick rejecting the support level at 1.3281.
Today’s USD/CAD Signals
Risk 0.75% per trade.
Trades may only be taken before 5pm New York time today.
Short Trades
Short entry after the next bearish price action rejection following the next touch of 1.3264 or 1.3327.
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 ride.
Long Trades
Long entry after the next bullish price action rejection following the next touch of 1.3208 or 1.3193.
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 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 the price had short-term bearish momentum, but when it turned bullish, it could be a good time to enter long with the odds on your side. I was ready to take a bullish bias if the price made a healthy bullish bounce at the support level of 1.3281. It did so, I was wrong, and it failed.
The price has continued to move lower, as Crude Oil recovers somewhat from its recent sharp fall, but bulls should not give up hope yet, as given the high volatility this bearish move can still be regarded as a normal retracement. The price may well go on to turn bullish again and make new highs, especially as it gets close to the 1.3200 area. I would still be prepared to take a bullish bias if we get a good bounce at the support levels nearby, however that is quite unlikely to happen before the London session ends at which time liquidity will become very thin due to the U.S. Holiday.
There is nothing important due today concerning either the CAD or the USD. It is a public holiday in the U.S.A. today.