HomeContributorsTechnical AnalysisEURCHF Extends Advance Towards 200-Day SMA

EURCHF Extends Advance Towards 200-Day SMA

  • EURCHF extends recovery to a fresh 2-month high
  • Breaks above trendline and eyes 200-day SMA
  • Momentum indicators approach overbought levels

EURCHF has been in a downtrend since the beginning of 2023, dropping to an all-time low of 0.9252 on December 29. However, the pair has been staging a rebound in 2024, violating the downward sloping trendline that connects its lower highs in the past year and posting a fresh two-month peak on Monday.

Should the pair resume the recovery and jump above the 200-day simple moving average (SMA), immediate resistance could be met at 0.9574, which is the 38.2% Fibonacci retracement of the 1.009-0.9252 downleg. Claiming that zone, the price may test the 50.0% Fibo of 0.9674, a region that held strong both in September and November. Further upside attempts could stall at the 61.8% Fibo of 0.9774.

Alternatively, if the pair experiences a pullback, the August support of 0.9515 could prove to be a tough barrier for the bears to overcome. Sliding beneath that floor, the price might descend towards the 23.6% Fibo of 0.9451. A violation of that region could set the stage for the December support of 0.9402, which overlaps with the 50-day SMA.

In brief, EURCHF has been in a recovery mode since the beginning of the year, but the long-term downtrend remains intact. Therefore, a break above the 200-day SMA is needed for the bulls to regain some confidence about a full-scale reversal.

XM.com
XM.comhttp://clicks.pipaffiliates.com/c?c=231129&l=en&p=0
XM is a fully regulated next-generation financial services provider of online trading on currency exchange, commodities, equity indices, precious metals and energies, with services to clients from over 196 countries worldwide. Founded in 2009 by market experts with extensive knowledge of the global forex and capital markets and with the aim to ensure fair and reliable trading conditions for every client, XM has reached international recognition by virtue of its unbeatable execution of orders, spreads as low as zero pips on over 50 currency pairs, gold and silver, flexible leverage up to 888:1, and personalized customer engagement to foster clients’ success.

Featured Analysis

Learn Forex Trading