Yesterday’s signals produced a losing long trade from the doji candlestick which rejected the support level I had identified at 1.3388 but made a little less than the minimum 20 pips of profit.
Today’s USD/CAD Signals
Risk 0.75% per trade.
Trades may only be entered before 5pm New York time today.
Long Trades
Go long after the next bullish price action rejection following the next touch of 1.3375 or 1.3345.
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 1.3470 or 1.3529.
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 yesterday that the price was within sight of multi-week highs at around 1.3470 and a break above there, and ideally the psychological level at 1.3500 also, could see the start of a much stronger bullish directional movement. However, I was waiting for 1.3470 to be broken to the upside before taking a bullish bias and it never happened. Instead the price broke the support level as Crude Oil’s advance sent the Canadian Dollar a little higher, but that support can now be adjusted to 1.3375.
I am still looking for long trades here, but I want to see a couple of hourly closes above 1.3470 and that is very unlikely to happen today. An alternative would be to look for healthy bounces at any of the support levels below the current price, especially 1.3375 – I would take a bullish bias also if we got a strong bounce there on above-average volatility.
This currency pair is worth watching this week.
There is nothing of high importance due today concerning either the CAD or the USD.