CAD/CHF Bounces off 50% Retracement Level

The CAD/CHF cross reversed lower at the 50% retracement level of the recent downmove that began in January 2018. Stochastics are curved lower and poised to cross the 80 level, which would add to the bearish scenario for the pair.

Price is trading under the 200 period simple moving average which lies close to the 61.8% retracement level, marking an important area of resistance. Potential support lies beneath at the prior highs of 0.7427 and the swing low level of 0.7222.

Last Thursday, Statistics Canada reported that the trade deficit widened more than expected, pressuring the Loonie. However, a revamped North American Free Trade Agreement (NAFTA) trade deal would likely lift the Canadian currency. The Trump administration is pushing for a preliminary NAFTA deal to be announced at the summit in Peru which begins on April 13th.

The Swiss Franc has been boosted recently by trade tensions between the United States and China, along with other safe havens such as the Japanese Yen and gold. The Swiss National Bank (SNB) has been using negative interest rates and currency market interventions to prevent to hold down the franc, whose strength weighs on exports.

On Monday, the Swiss Unemployment Rate came in at 2.9%, in line with expectations. Later on Monday the Bank of Canada (BOC) Business Outlook Survey is set for release.