This exercise was taught to me by my dressage trainer. He sometimes prefers to ask the young horse to canter from a 20m trot circle the other way, so you change the bend at X and give the canter aid to strike off.
This exercise prevents young horses from falling in, from anticipating the canter, and usually from running into canter. Because you have engaged the inside hind on the trot circle, the new outside hind in canter is ready to really engage, usually giving a good canter from the start.
It’s good for checking the rider’s straightness, reactions, and control of the shoulders.
It should of course be performed starting from trot on both reins.