Last Thursday’s signals were not triggered, as there was no bearish price action at either 1.3284 or 1.3310.
Today’s USD/CAD Signals
Risk 0.75% per trade.
Trades must be entered by 5pm New York time today only.
Long Trades
Go long after the next bullish price action rejection following the next touch of 1.3250 or 1.3208.
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.
Short Trades
Go short after the next bearish price action rejection following the next touch of 1.3295, 1.3332 or 1.3367.
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.
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 I expected we would see higher prices still over the course of the day. I took a bullish bias on this currency pair as there was strongly bullish momentum and resistance levels were being invalidated. This was a good call as the price continued to advance quite strongly over the rest of the London and New York trading sessions that day.
We have since seen a drop and retracement which looks serious due to its relatively high volatility and also as it printed a new lower resistance level at 1.3295. The longer the price stays below 1.3300 the less bullish the picture would become, but I still see the odds as with the bulls. We may get little movement today as it is a Monday with no major USD data events scheduled. I would be prepared for a conservative long trade if there is another drop to 1.3249 followed by a quick and healthy bullish bounce.
There is nothing of high importance due today regarding either the CAD or the USD.