Offsetting a currency hedge

Got a question concerning currency hedging.
Say for example I have a USD/CAD currency hedge maturing in 1 year where I am long USD $10MM.
6 months pass and I am deep out of the money owing USD $1MM to my counter-party.
So I decide to call it quits and setup an offsetting hedge of short USD $10MM.
Has my loss of USD $1MM been crystalized and should not change even if currency fluctuates or interest rates change?


Thanks. I actually am in this scenario so executed an offsetting trade but the net MTM is showing daily fluctuations which is bizarre!

Not so bizarre.

The people trading those positions may not realize that you have one of each and that they’re supposed to track each other. Please don’t castigate them for their ignorance.

At expiration, your loss will be locked in, just as the price of a bond is locked in at maturity, even though it can fluctuate before then.