Many believe the US dollar could peak this week, but USDCAD might still have another 330 pips of upside potential this month.
In today’s video, I’ll explain why that’s the case and share the key technical trigger that could push USDCAD toward its decade-long range highs.
You’ll also get the latest analysis on the US Dollar Index (DXY).
USDCAD has climbed over 400 pips since breaking out of a two-year consolidation in late October.
The breakout was confirmed by consecutive weekly closes above 1.3870, clearing the path to targets at 1.4265 and 1.4670.
I highlighted this trade idea several times in November and December of last year.
So far, USDCAD has reached the first target at 1.4265, but the decade-long range highs at 1.4670 remain untested, offering potential for further upside if the US dollar continues to show strength.
While there’s no guarantee USDCAD will reach 1.4670, it remains the most likely scenario given the range established since 2015.
This week’s pullback might raise concerns, but it hasn’t invalidated the uptrend or the likelihood of a retest of 1.4670.
That said, USDCAD bulls need to reclaim the 1.4350 range lows to target 1.4450 and potentially the final resistance at 1.4670.
In the meantime, we could see a sweep of Monday’s low and a full retest of 1.4260 before buyers step in again.
Turning to the DXY, the 108.00 level is holding as support this week, keeping the uptrend intact.
However, a retest of 107.00-107.50 can’t be ruled out, especially with key events like the US ADP employment change, FOMC minutes, and Friday’s non-farm payroll on the horizon.
