Last Thursday’s signals were not triggered as none of the key levels were reached, although the resistance at 1.3402 did a good job at capping the high of that day.
Today’s USD/CAD Signals
Risk 0.75% per trade.
Trades may only be taken between 8am and 5pm New York time today.
Long Trade
- Long entry after the next bullish price action rejection following the next touch of 1.3339.
- 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 1.3402 or 1.3470.
- 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 last Thursday that this pair was in a confusing situation, so it might be best to avoid trading this pair for the time being. I had no directional bias.
The situation now is clearer, although there is still no long-term trend: the price is established within a symmetrical medium-term bearish channel, which can be seen in the chart below. This means that the confluence of the trend line, resistance and round number at 1.3400 make that an attractive area at which to find a short trade after a bearish reversal. If we get a strong rejection there, I would take a bearish bias on this pair today, although we have a couple of support levels close by.
There is nothing important due today concerning either the CAD or the USD.