USDCAD: Confused technical picture
Last Thursday’s signals were not triggered, as none of the key levels were hit that day.
Today’s USD/CAD Signals
Risk 0.75% per trade.
Trades must be taken between 8am London time and 5pm New York time today only.
Long Trade Ideas
Long entry after the next bullish price action rejection following the next touch of 1.3177 or 1.3120.
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 Idea
Go short after the next bearish price action rejection following the next touch of 1.3308.
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 last Thursday that I was still bearish on this currency pair, technically, over the long-term, but it just did not seem ready to happen yet.
I was looking for a strong bearish reversal at 1.3246 and then to take a bearish bias if it set up later.
The price never hit that level, so this call was at least enough to keep out of trouble. I was also correct to note that the bearish move did not seem ready to happen – and it did not happen as the price moved up to new highs.
There is a lack of any clear trend and the picture is further complicated by the strong jump in the price of crude oil due to the military strike on a Saudi oilfield over the weekend, which has pushed up the CAD as a petrocurrency.
It is hard to make any call here, but a strong reversal at the extremes such as the 1.3100 area or 1.3308 could be an interesting trade if it sets up. I would prefer to take a long trade, but this would probably require a serious defusing of tension in the Gulf to happen. It could be that Saudi Arabia declines to publicly blame Iran for the strike, and that might be enough.
There is nothing of high importance due today concerning either the CAD or USD.