USDCAD has been on a roll -- so much so that the pair is now at 13 year highs, as it has rallied approximately 1,000 pips in the past month and a half. The monthly chart below of USDCAD illustrates.
With that said, the chart above shows the pair is at resistance now, and so we may have a pullback before further rallies. The FXCM Dollar Index, which tracks the US dollar against a basket of equally weighted major currencies, shows that the US dollar has broken out past resistance; some consolidation now or a re-test of the recently broken through resistance level may occur before the US dollar moves higher. If the US dollar ends up going higher after consolidation, and if USDCAD mirrors this by pulling back and then going higher as well, we may see USDCAD go all the way back to around 1.58 -- a move of almost 1600 pips from where we currently are. There are a couple resistance levels between where we currently are and the highs above 1.58 reached in 2002 -- they are shown on the chart below -- but a sustained US dollar rally, if it occurs, might be able to push the market through them.
With that said, the chart above shows the pair is at resistance now, and so we may have a pullback before further rallies. The FXCM Dollar Index, which tracks the US dollar against a basket of equally weighted major currencies, shows that the US dollar has broken out past resistance; some consolidation now or a re-test of the recently broken through resistance level may occur before the US dollar moves higher. If the US dollar ends up going higher after consolidation, and if USDCAD mirrors this by pulling back and then going higher as well, we may see USDCAD go all the way back to around 1.58 -- a move of almost 1600 pips from where we currently are. There are a couple resistance levels between where we currently are and the highs above 1.58 reached in 2002 -- they are shown on the chart below -- but a sustained US dollar rally, if it occurs, might be able to push the market through them.
USDCAD Hits 13 Year High -- But Now at Resistance
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