USDCAD: Which Dollar Will Prevail?

·    November 16, 2017

·      November 16, 2017

·    November 16, 2017

The USDCAD is at a crossroads. Just the other day we discussed the trend line support that extends from the current 2017 low. That level intersects with the 1.2770 horizontal level near current prices.

Yesterday’s session attempted to close back above the 1.2770 handle. However, buyers fell short of their goal and are once again struggling today.

This puts the USDCAD in a delicate position. If the pair can’t manage a daily close (5 pm EST) back above the 1.2770/5 area, the only option is a move below trend line support near 1.2720. If that occurs, we could see prices slide toward 1.2590 and perhaps 1.2420.

On the other hand, if buyers manage a daily close above 1.2770 it would put us right back to targeting 1.2915 followed by 1.3000.

It’s no secret the U.S. dollar has struggled lately. That said, the Canadian dollar has performed even worse. The stalemate between the two is the reason for the terminal pattern below.

In times like this, it’s important not to draw any conclusions until we have some form of confirmation. In the case of the USDCAD, that means a daily close below trend line support near 1.2720 or above horizontal resistance at 1.2770/5.

Until that occurs, the likely path forward is unclear. Although as you can see, the limited real estate will force participants one way or the other within the next few sessions.

A word of caution, though. Recent market conditions have proven difficult, both in reading the price action as well as garnering follow through. With this in mind, it may be a good time to reduce position sizes or scale into positions so as to mitigate potential losses.

[thrive_custom_box title=”” style=”dark” type=”color” color=”#fef5c4″ border=”fadf98″]

Get Free Forex Trade Setups Delivered To Your Inbox! Click Here To Get Alerts


USDCAD intersection of trend line support and horizontal resistance

Continue Learning


Leave a Reply

Your email address will not be published. Required fields are marked *

  1. Too many opportunities brings challenges,the market has been showing me flames as well,thanks for clearing that out Jb,I also tink it would be best take take A+ only,what a setback

  2. “Recent market conditions have proven difficult…”
    Thank you for affirming that the choice to slow my trading frequency over the last month or so was possibly an instinctive notice of this trend rather than a loss of confidence. I’d booked rather significant profits from september-october and had recently struggled with finding new trade opportunities enticing enough to warrant new risk. I had assumed it was plain fear, but now I’m left to wonder “Am I finally starting to get this right?”

    Thanks again for all that you do.

  3. I went long at 1.26750. I thought it would go up to the 1.29 level. But when I saw it struggling at 1.2770 level, I closed the trade at 1.2730. The current action is choppy. Best to stay out.

    Good Luck Guys.

  4. Hi Justin. I don’t like it when on consolidation because one never knows which side the chart will go. I prefer to stay on the sideline until I get confirmation where it’s heading. Thanks for validating my feelings. I’m getting better by day from your lessons

{"email":"Email address invalid","url":"Website address invalid","required":"Required field missing"}