USDCAD: Weakly bearish below 1.3200
Yesterday’s signals were not triggered, as the bullish price action took place a little way below the support level identified at 1.3212.
Today’s USD/CAD Signals
Risk 0.75% per trade.
Trades must be entered between 8am London time and 5pm New York time today only.
Long Trade Idea
⦁ Long entry after the next bullish price action rejection following the next touch of 1.3140.
⦁ 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 Trade Ideas
⦁ Short entry after the next bearish price action rejection following the next touch of 1.3213, 1.3251, or 1.3282.
⦁ 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 I would take a cautiously bearish bias if we saw 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. This wasn’t a bad call as this level did turn out to be pivotal for the day although the price movement was very small. Finally, we did get two hours closing consecutively below that level and the price is little changed from there.
Action is slight, weak, and choppy, making this a difficult pair for traders. The most I can say is that 1.3213 still looks very pivotal and the price has room to move down from there, but the Canadian Dollar is not very strong so I’m not confident this bearish move is ready to happen.
I would take a weakly bearish bias on this pair today, cautiously, if we see two consecutive hourly closes below 1.3200 during the London session.
There is nothing of high importance due today concerning either the CAD or the USD.