Is it possible to rotate the canvas in QGIS

In QGIS at bottom right corner, there is an option called 'Rotation'.

There you can rotate your canvas (or extent of view) by any angle.

Map canvas rotation is being added as a feature to QGIS 2.8. Here's a video posted by Faunalia of the feature.

https://www.youtube.com/watch?v=7TN3toqcyks

If creating new projection is not the answer then I am not aware about any direct way.

From my point of view if QGIS starts with dynamic rotation it should be taken directly to another level - 3D (2.5) like Arscene/Google Earth/Discover 3D to name few approaches of different software solutions...

There is some way through plugin GLOBE:

https://www.youtube.com/watch?v=ZDDe-sVogNU

GRASS (NVIZ):

http://linfiniti.com/2010/12/3d-visualisation-and-dem-creation-in-qgis-with-the-grass-plugin/

And export plugin:

http://anitagraser.com/2014/03/15/3d-viz-with-qgis-three-js/