CAD/CHF is currently trading above a short-term tentative upside support line taken from the low of April 20th. Lats week, the pair managed to break above the short-term downside resistance line taken from the high of May 12th. Another positive aspect is that the rate is still hanging above all of its EMAs on our 4-hour chart. For now, we will stay bullish and aim slightly higher.
If the bulls find it difficult to overcome straight away the current high of today, at 0.7467, this could force the rate to correct back down a bit. That said, if CAD/CHF continues to trade above all the EMAs, another upmove might be possible. If this time the pair is able to shoot through the 0.7467 barrier, this will confirm a forthcoming higher high, potentially clearing the path for a move to the 0.7485 obstacle, or to the 0.7495 level, marked by the highs of May 19th and 18th respectively.
The RSI and the MACD are both pointing higher. In addition to that, the RSI is above 50 and the MACD is above zero and its trigger line. The two indicators show positive price momentum, which support our main scenario, discussed above.
Alternatively, if the rate falls below all the EMAs, drops below the 0.7417 hurdle, marked by an intraday swing high of May 26th, and then breaks the aforementioned upside line, this could spook new buyers from entering for a while. More sellers may join in and send the pair further south. CAD/CHF might end up testing the lowest point of May, at 0.7395, a break of which would confirm a forthcoming lower low. Such a move might open the door for a move to the 0.7353 level, marked by the low of April 27th.
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