CAD/CHF: Carry Trade Favors Loonie Against Swiss Franc

The Canadian dollar has been performing well against the Swiss franc due to the interest rate differential and external influences from the oil markets. According to a recent analysis by Christopher Lewis, a technical analyst at DailyForex, this pair is supported by the carry trade.

As the market approaches the psychologically significant 0.59 level, traders may see some profit-taking, which could lead to a slight pullback. However, this doesn't necessarily mean a major change in the market's trend. The interest rate differential, with the Swiss National Bank maintaining a zero interest rate policy, continues to favor the Canadian dollar.

The 0.5850 level offers support for the Canadian dollar, accompanied by the 50-day EMA at 0.5810 and the 200-day EMA. This makes it difficult for traders to be excited about owning the Swiss franc in this environment, not just against the Canadian dollar but also other currencies.

Overall, Lewis is following the carry trade, which avoids the noise around the Japanese yen, making the CAD/CHF pair an attractive option.