Yesterday’s signals were not triggered, as there was no bullish price action at 1.3165.
Today’s USD/CAD Signals
Risk 0.75% per trade.
Trades may only be entered before 5pm New York time today.
Long Trade
Long entry after the next bullish price action rejection following the next touch of 1.3055.
Put 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.
Remove 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
Short entry after the next bearish price action rejection following the next touch of 1.3206, 1.3218, or 1.3262.
Put 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.
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 yesterday that the picture was looking more bearish as the USD continued to weaken, and we had new lower resistance at 1.3218. I was ready to take a bearish bias if we get a retrace to that level later and a firm bearish rejection, but it looks right now that the support at 1.3165 is likely to be hit first before that happens. This was a good call as the level at 1.3165 was reached (and then invalidated) before the price began to move up. There is new lower resistance just below 1.3218 at 1.3206 where the price seems to have turned bearish in recent hours. Crude Oil is strong and there is no support until 1.3055 so lower prices look likely. I would take a bearish bias if the price can trade below 1.3150 for a couple of hours on relatively high volatility.
Concerning the USD, there will be a release of Core Durable Goods Orders at 1:30pm London time. Regarding the CAD, the Governor of the Bank of Canada will be giving a minor speech at 5:35pm.