USDCAD: Weakly bearish below 1.3212
Last Thursday’s signals produced a losing long trade from the bullish bounce at 1.3250.
Today’s USD/CAD Signals
Risk 0.75% per trade.
Trades may only be taken before 5pm New York time today.
Long Trade Ideas
⦁ Go long after the next bullish price action rejection following the next touch of 1.3212 or 1.3140.
⦁ 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
⦁ Go short after the next bearish price action rejection following the next touch of 1.3251 or 1.3282.
⦁ 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 the price had generated a new higher low at the key psychological level of 1.3250, which was a bullish sign. I saw the line of least resistance as definitely upwards and took a bullish bias from any bounces at key support levels. This was a bad call, as the price broke back below 1.3250 and has been falling ever since. At the time of writing the price is sitting right on the support level at 1.3212 which looks likely to break down. If it does break down, we are likely to get a stronger fall as there is room for the price to fall.
I will take a cautiously bearish bias if we see the price get established below the support level at 1.3212, ideally with all the action below that price for a couple of hours consecutively determining such a break down.
There is nothing of high importance due today concerning either the CAD or the USD.