CADCHF escapes flag to downside
17 January 2023
In today’s technical part, we have an unusual guest – CADCHF that would probably not be your first pick in terms of the trading instrument. Though maybe it should be, as in the past several weeks the pair has been trading extremely technically.
First of all, CADCHF is in a long-term downtrend that started in May of last year. It is pretty natural that in the downtrend, you have significant bearish drops and smaller, bullish corrections. The corrections here were really very technical (red). We had two wedges and two flags. The most recent one is a flag and the price is currently breaking its lower line.
A Breakout of the lower line of the flag in the downtrend usually means a sell signal. I do not think it is or should be different this time. The sentiment is negative. Price coming back inside of the flag would cancel that but chances of that happening are currently rather low.