Traders are turning a bit negative today, and with a top tier catalyst ahead from Canada, we’re looking at a technical setup on CAD/CHF for potential pips into the weekend.
Before moving on, ICYMI, today’s Daily London Session Watchlist looked at an opportunity forming on GBP/AUD as risk appetite returns to the markets, so be sure to check that out to see if there is still a potential play!
|Equity Markets||Bond Yields||Commodities & Crypto|
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Fresh Market Headlines & Economic Data:
Upcoming Potential Catalysts on the Economic Calendar for U.S. & Asia:
Fed Bostic speech at 4:00 pm GMT
Japan PPI at 11:50 pm GMT
Canada Employment change & unemployment rate at 12:30 pm GMT (July 10)
What to Watch: CAD/CHF
On the hourly chart above of CAD/CHF, we can see a slow grind lower, forming a pattern of lower ‘highs’ but some resistance from the bulls to break around 0.6920. Basically, the pair is consolidating into a descending triangle pattern, which could break tomorrow on a top tier Canadian economic catalyst.
During the Friday U.S. trading session, we’ll get the latest Canadian employment update, with expectations of 400K net job gains in June. If we see a better-than-expected update, then the Canadian dollar could pop higher for the week, and in that scenario, watch out for a break above the falling ‘highs’ pattern as the signal to start working on a long position.
If the Canadian jobs number disappoints, then a break below the 0.6920 level may draw in CAD/CHF bears for the session, especially if coronavirus news updates are pushing traders to lean toward risk aversion.
A break and hold below 0.6920 could possibly lead traders to take the pair lower to the 0.6880 handle, which is within the daily ATR range and was the minor support area that drew in buyers back in May 2020.