USDCAD: Strongly Bearish at new 4-month low
Yesterday’s signals were not triggered, as none of the key levels were ever reached.
Today’s USD/CAD Signals
Risk 0.75% per trade.
Trades may only be entered between 8am London time and 5pm New York time today.
Long Trade
Go long upon the next touch of 1.3054.
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 run.
Short Trades
Go short after the next bearish price action rejection following the next touch of 1.3153.
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 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 it was very interesting that although the USD came back against almost every currency, it still looked just as weak here against the CAD. This told us there was relative strength right now in the Canadian Dollar. Technically, the bearish consolidation continues, so there is no change there.
I was ready to take a bearish bias if we got a strong bearish failure at 1.3250 later, or if the price broke below 1.3150 during today’s New York session on above-average volatility. The price did exactly that, breaking below 1.3150 and moving down to a low just above 1.3100, so this was a very good call.
The technical picture remains bearish, with only a relatively weak bullish retracement so far, and new lower resistance at 1.3153.
I will take a bearish bias on this currency pair today if we get a strong break below 1.3100 during the New York session on above-average volatility, or at a firm bearish rejection of 1.3153.
There is nothing of high importance due today regarding the CAD. Concerning the USD, there will be a release of Final GDP data at 1:30pm London time.