GBP/CHF drops sharply today as poor GDP and production data add to the case of imminent BoE easing. Technically, rise form 1.1674 should have completed at 1.3310, on bearish divergence condition in daily MACD, ahead of 1.3399 structural resistance.
Now, with 38.2% retracement of 1.1674 to 1.3310 at 1.2865 firmly taken out. Deeper fall should be seen to 61.8% retracement at 1.2299. However, such decline is currently seen as a correction. We’d expect strong support from 1.2299 to contain downside to bring rebound. Meanwhile, but break to 1.2854 resistance is needed to indicate completion of the fall. Otherwise, risk will remain on the downside in case of recovery.
