USD/CAD Price Forecast January 11, 2018, Technical Analysis

The US dollar was very volatile during the trading session on Wednesday, ultimately settling on testing the 1.25 level above. If we can break above the 1.2525 handle, the market could go much higher, perhaps turn around and rally towards the 1.29 level. However, I think that it is very difficult to imagine a scenario where it will be easy to do that. We will need to see the oil markets roll over in my estimation to have that move. Otherwise, if we get some type of exhaustive candle, we will probably break down from there and go towards the 1.2350 level.

I think that the US dollar could be in trouble for 2018, and this pair could be one of the more interesting places to trade it, as it is so highly leveraged to the crude oil market, which of course is very volatile. I believe that the market will continue to be choppy, but in this current environment I think that the 1.25 region will be the most important level to pay attention to. Once the market makes its next move obvious, then you can simply follow. We have obvious targets, and we have an obvious launching pad in the form of the 1.25 handle. By being patient, you should be able to figure out where the true momentum presents itself.

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