The Canadian dollar remains very choppy against the Franc but looks very supported in general.
CAD/CHF
The Canadian dollar remains very choppy against the Swiss franc during the Friday session in what would have been thin action anyway due to the fact that it was Good Friday. The price is between the 50-day EMA, which is below and acting as dynamic support, and below the 200-day EMA, which is above and acting as dynamic resistance.
All things being equal, the recent price action shows a bit of a change of character on lower time frames, shifting from aggressive selling to a corrective bullish structure. The Relative Strength Index is trending upward, suggesting there is building momentum, though traders are looking for a potential bearish trap or a rebalance near current levels before a sustained move.
Economic Differentials and Geopolitical Tensions
There are several different things going on at the same time. It is a classic commodity versus safe-haven type of play, with interest rates being bullish here as Canada has much higher interest rates than the Swiss, who of course are maintaining a 0% interest rate policy.
Energy prices are bullish for the crude oil markets and of course the Canadians benefit from that as they are an oil exporter. At the same time, though, there is a bit of safe-haven demand in this current market environment and that favors the Swiss franc.
So, it is a matter of back-and-forth pressure that we will be dealing with. If prices can break above the 0.58 level, this could be a nice buy-and-hold type of move. If global tensions escalate further, safe-haven flows into the Swiss franc could override oil-driven Canadian dollar strength, potentially dragging the pair back towards the 0.5640 liquidity zone. As of today, the short-term bias appears cautiously bullish as long as the price stays above 0.5710.
Potential signal: I am a buyer of this pair above 0.5755, with a stop loss at 0.57, and a target of 0.58, where I will NOT take profit, and move stop loss to breakeven.