USDCAD has been relatively choppy in 2024, but my target that I set on January 3rd remains 1.3870, and today’s video explains why.
I also shed some light on what’s happening with the US Dollar Index (DXY), and why the bottom may be in.
Let’s get to it!
USDCAD has consolidated over the last couple of weeks following a breakout that began on April 10th.
This isn’t surprising considering the imbalance that was left in the wake of that April 10th breakout candle.
For USDCAD to remain constructive, bulls need to keep the pair above 1.3650 and especially 1.3600 on a daily closing basis.
Do that, and I think we see another leg up for USDCAD.
One reason I think that is the 1.3870 level that went untested in mid-April.
The 1.3870 region has been key resistance for USCAD since October 2022, so there’s bound to be liquidity at and above that level.
Markets seek liquidity, so 1.3870 could become a magnet later this month.
With that said, I need a more favorable entry to justify a position, especially in a market as choppy as USDCAD has been this year.
If we see USDCAD dip into the sub 1.3640 region, I’ll entertain a long position targeting 1.3750 and 1.3870.
But the risk-to-reward at current levels is less than ideal.
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