CAD-CHF Reversal Needs a Confirmation

By: Mike Kulej

One of the currency crosses that do not get much attention from mainstream analysts is the Canadian Dollar- Swiss Franc. This pair is often overlooked in favor of US Dollar pairs with these currencies. However, the CAD-CHF moves enough to be a viable trading instrument and is worth following.

Since May, the Swiss Franc has been getting stronger against most of its counterparts and the Canadian Dollar is no exception. This pair dropped from the high of 1.1152 to the recent low 0.9333. During the last few weeks, the CAD-CHF has been slowly climbing higher and could be close to confirm a trend reversal to bullish.

Currently the price is approaching an important resistance of 0.9962. In the process, it formed a possible saucer type reversal, a variation of a cup with a handle. Formations like this one are often seen at bottom reversals. We can also see an ascending triangle, another positive development.

The MACD indicator supports the possibility of a reversal here. It is currently above the zero line and climbing. In addition, the Three Line Break chart also appears to have turned up, indicated by a move above the trendline. Closing above the 0.9962 resistance could start a much larger bullish move in the CAD-CHF.