GBP/CHF was the top mover last month, closed up 3.56% or 450 pips. Though, notable resistance was seen from 100% projection of 1.1102 to 1.2259 from 1.1683 at 1.2840, and more importantly from 55 month EMA (now at 1.2794), that limited upside. A short term top is likely formed at 1.2893 as GBP/CHF turned into a near term corrective pattern.
Some time would be needed to GBP/CHF to digest the prior strong upmove, and build the base for another rally. But for now, we’d expect strong support from 1.2259 resistance turned support to contain downside, even in case of deeper pull back. Another break of 1.2893 could push GBP/CHF through 55 month EMA, which carries long term bullish implication. The cross could then target 1.3854 key resistance to confirm long term bullish trend reversal.
