USD/CAD Price Forecast January 29, 2018, Technical Analysis

The US dollar has broken down a bit against the Canadian dollar again, as the US dollar has been beaten up by the Forex world in general. With oil rallying, it makes sense that the Canadian dollar will as well. I think that if we break down below the 1.23 handle, the market is ready to go down to the 1.21 level underneath. There is a massive amount of support at the 1.20 level underneath, and I think that will be the absolute bottom of any selloff. If we were to break down below there, then the bottom falls out and we could find ourselves going back towards the parity level.

Alternately, if we break above the 1.24 handle, the market should continue to go towards the 1.25 level. A break above there clears the USD/CAD pair to go to much higher levels, perhaps to the 1.30 level. The volatility that we have seen overall should continue to be a major problem with this market, but if you can take small positions, you can benefit from the overall downward spiral. I think this pair will of course follow what’s going on in the oil markets, it typically does, and oil markets look very healthy right now. That should continue to favor a downward move. If the greenback continues to get beat up against the Euro, Pound, and many others, that will only add more bearish pressure in the pair here, and of course will have a bit of a cyclical influence, pushing oil higher as well.