Yesterday’s signals produced a profitable short trade following the bearish engulfing candlestick combo rejecting the resistance level identified at 1.3282.
Today’s USD/CAD Signals
Risk 0.75% per trade.
Trades must be entered before 5pm New York time today only.
Long Trade
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Go long after the next bullish price action rejection following the next touch of 1.3165.
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Place the stop loss 1 pip below the local swing low.
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Adjust the stop loss to break even once the trade is 20 pips in profit.
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Take off 50% of the position as profit when the trade is 20 pips in profit and leave the remainder of the position to ride.
Short Trades
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Go short after the next bearish price action rejection following the next touch of 1.3218, 1.3262, or 1.3282.
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Place the stop loss 1 pip above the local swing high.
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Adjust the stop loss to break even once the trade is 20 pips in profit.
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Take off 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 I saw 1.3262 as likely to be the pivotal level: if it was not breached and Crude Oil rose again later today when the U.S. returns from holiday, I would take a bearish bias here as we might see a nice downwards movement with no support to break it until 1.3165. This was not a great call as the price continued to rise to the next resistance level at 1.3282 before rejecting it to the pip and turning very bearish and falling quite a long way.
The picture now looks more bearish as the USD continues to weaken, and we have new lower resistance at 1.3218. I would take a bearish bias if we get a retrace to that level later and a firm bearish rejection, but it looks right now that the support at 1.3165 is likely to be hit first before that happens.
There is no long-term trend so trading this pair can be difficult.There is nothing of high importance due today regarding the CAD. Concerning the USD, there will be a release of FOMC Meeting Minutes at 7pm London time.
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