Since its reversal to the upside on November 21st, CAD/CHF continues to move higher, pushing above all of its EMAs on the 4-hour chart. At the same time, the pair is trading above its newly-established short-term tentative upside support line drawn from the low of November 26th. But given that the rate right now is struggling to push above the high of this week, at 0.7535, we will remain cautious and wait for it to be broken first, before considering a further move north.
If, eventually, the 0.7535 barrier surrenders to the bulls and breaks, this could open the door for a move to the 0.7559 hurdle, which is the high of November 8th. Initially, the pair might get a hold-up around there, or even correct back down a bit. But if CAD/CHF continues to balance above the 0.7535 zone, this could result in another round of buying, possibly pushing the rate beyond the 0.7559 area and aiming for the 0.7570 level, marked by the highest point of November.
Looking at the RSI and the MACD on the 4-hour chart, we can see that it would be slightly difficult to rely on them right now. The RSI, although a bit above 50, is currently somewhat flat and is not showing any clear direction. The MACD is above zero, but remains below its trigger line, while sitting flat at the moment. Both indicators support the our cautiously-bullish idea, at least for now.
Alternatively, if the aforementioned short-term upside line breaks and the rate slides below the 0.7511 support zone, marked near the high of November 19th and near the lows of yesterday, this could attract more sellers and send CAD/CHF further south. The next possible support area to consider might be the low of this week, at 0.7483, which if broken may lead the pair to the 0.7464 level, marked by an inside swing low of November 21st.
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