The US dollar may be in a position to score big versus its little brother up north – the Canadian dollar. As you can see from the weekly chart of the USDCAD pair, it looks to have just broken out from a rather massive rounding bottom pattern when it successfully punched through its neckline resistance at around 1.0658. If the pair can stay above this level then it may rise first towards it initial resistance at 1.1000. A move past that may then hurl it all the way to 1.1750. Given the height of the pattern, it is quite possible that it may indeed reach for the said target. In any case, a fall below 1.0658 may bring it down to 1.0250.
Personally, we’ve recently gone long on the USD and at the same time short on the Loonie with the plan to hold on to the pair until it reaches 1.1750.
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