USDCAD Future Direction Hinges on 1.3300

by Justin Bennett  · 

December 21, 2023

by Justin Bennett  · 

December 21, 2023

by Justin Bennett  · 

December 21, 2023

Today I’m going to share a pivot level for USDCAD that dates back to 2021 that will likely determine the future direction for the pair.

I’ll also provide an update on the US Dollar Index (DXY).

Watch the video below and scroll down for the annotated charts and analysis.

USDCAD is testing a pivotal level this week that could determine the trend for the next six to twelve months.

The last time I mentioned the 2021 trend line was back in July and August when USDCAD was testing the level near 1.3100.

That retest triggered an 800-pip rally over the next four months.

A rejection from the 1.3870 resistance level has USDCAD testing its 2021 trend line again this week.

As I write this, the pair is trading just below that mark at 1.3315 with Canada GDP on deck in less than 24 hours.

That’s going to introduce substantial volatility for a pair like USDCAD, so caution is needed here.

However, a reclaim of levels like 1.3350 and 1.3410 would make things interesting for a potential long.

The risk-to-reward at current levels is more than favorable, and longs are in agreement with the higher lows since 2021.

Of course, we have to plan for a possible failure as well.

A sustained break below this trend line would set up a run at the July lows near 1.3100.

But as long as this trend line is intact, I favor USDCAD longs, especially if bulls can reclaim some immediate resistance levels.

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