EUR/CHF Weekly Outlook

EUR/CHF's choppy fall from 1.5380 continued last week and extended further to as low as 1.5174. At this momentum, there is no clear signal that such fall has completed yet and further decline might still be seen. Nevertheless, downside is still expected to be contained well above 1.5011 support and bring rally resumption. Above 1.5270 will flip intraday bias back to the upside for 1.5380. Break will confirm rally resumption targeting 1.5446 resistance next.

In the bigger picture, fall from 1.5880 should have completed with three waves down to 1.4577 already. the corrective structure argues that such fall is merely a correction to medium term rise from 1.4315 only. Having said that, current development favors the case that long term down trend from 1.6826 has also finished at 1.4315. Focus will now turn to 1.5880 resistance for confirmation. On the other hand, break of 1.5007 support will turn outlook mixed again.

In the long term picture, outlook is rather mixed for the moment. On the one hand, the corrective three wave structure of the rise from 1.4391 to 1.6827 is arguing that fall from 1.6827 is resumption of long term down trend from 1.8234. The pattern of lower highs since 1.6826 gives no indication that such fall has completed yet. On the other hand, the failure to sustain below 1.4391 (01 low) and the lack of impulsive structure of fall from 1.6827 is not confirming the bearish case. Focus will be on the development of the rebound from 1.4315 for further hints.

Subscribe to our daily and mid-day newsletter to get this report delivered to your mail box