CADCHF bears have kept the pressure on since the 0.72 high on the 5th of June. Since the high, we have witnessed two attempted breaks towards the lower channel.
The first attempt on the 11th of June saw prices bounce off at the Ichimoku Cloud near 0.69. However, the second attempt, despite bouncing off at the lower channel, saw prices trading below the cloud, suggesting a return within its territory.
In addition, with the current action showing prices between the Tenkan and Kijun lines, an upside breakout can be expected. Should the median regression line be surpassed, we could see a rise towards the upper channel at 0.70.
Failing this upside attempt, we anticipate a third test on the lower channel again towards the 0.66 level.
In the short-term, the 2h chart shows bears taking hold of the pair. The momentum indicator hints at a hidden bearish divergence, which could indicate a pullback on the current upside.
This pullback could slide within the cloud, however, we do not expect a further weakness outside the cloud. Should this occur, it can result in another test at the lower descending channel.
On the other side, a bullish break through the median regression could support the long-term notion of a push to the 0.77 target. This is bolstered by prices currently trading above the Ichimoku.
