By Dan Eduard – Over the course of the last week, the Canadian dollar has been making significant gains against the Swiss franc. Analysts attribute the gains to a combination of poor Swiss economic news and positive indicators out of the US and euro-zone that has increased risk taking. As we will demonstrate through a number of technical indicators, the franc may be turning a corner and the CAD/CHF pair could see a downward correction in the near future.
We will be analyzing the daily chart for CAD/CHF provided by Forexyard. The technical indicators being used are the Bollinger Bands, Williams Percent Range and Stochastic Slow.
1. As seen in the chart, the cross is currently trading along the upper Bollinger Band, suggesting that a bearish correction may occur. In addition, the bands appear to be widening, which typically means a shift in direction is likely.
2. The Williams Percent Range is currently around the -15 level. Anything above -20 on this indicator typically means the pair is in overbought territory and a bearish correction is likely to occur.
3. Finally, a bearish cross has formed on the Stochastic Slow, meaning that downward pressure exists for the pair. Traders will want to pay close attention to this pair. Significant profits will likely be made by anyone who takes advantage of the impending correction.
Forex Market Analysis provided by ForexYard.
© 2006 by FxYard Ltd
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