The SNB, or the Swiss Negative Balance, event has left the ccy markets shaky und unstable. The NFA
delayed decision to hike the margin requirements has probably stifled volume
in the CHF markets, which is expressed in a lower price range. Notwithstanding that, CADCHF
is in one
of the strongest down trends of all the majors and is in the process of making a correction. A decisive rejection of the prior high, as well as the failure to make a new high, both seem to confirm the continuation of the down trend. But first the market has to break the bull trend line
of the corrective rally. The Swiss franc
, though still extremely strong, has been weakening for the most part of the last two weeks and its momentum is at relatively oversold levels. This is why I expect that the ongoing corrective rally may soon be followed by another leg down.
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