USDCAD: Bearish below 1.3192
Yesterday’s signals were not triggered, as the suitable price action took place beyond key levels of both support and resistance.
Today’s USD/CAD Signals
Risk 0.75% per trade.
Trades must be entered before 5pm New York time today only.
Long Trade Ideas
Long entry after the next bullish price action rejection following the next touch of 1.3120 or 1.3104.
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 ride.
Short Trade Ideas
Short entry after the next bearish price action rejection following the next touch of 1.3192 or 1.3247.
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 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 picture still looked bearish, although we have to wonder about the two support levels above 1.3100. I was prepared to take a bearish bias if we had gotten a solid bearish reversal at 1.3186.
This was an OK call as the price has continued to move lower over the past 24 hours overall, we just now need to adjust the resistance at 1.3186 to 1.3192. We can also remove the support at 1.3151 which has been invalidated – a bearish sign.
The picture is still bearish on all time frames, especially the long-term charts. We seem poised for a strong downwards movement technically over the coming weeks, but the price will have to get below the 1.3000 area to really trigger this. The support levels shown in the chart below are a long-term pivotal point.
I take a bearish bias today below 1.3192.
There is nothing of high importance due today concerning the CAD. Regarding the USD, there will be a release of Crude Oil Inventories data at 3:30pm London time.