EUR/CHF dropped sharply to as low as 1.1212 last week. The strong break of 1.1310 support confirmed that rebound from 1.1181 has completed at 1.1444. Initial bias remains on the downside this week for retesting 1.1173 low, as well as 1.1154/98 key support zone. We’d look for strong support from there to bring rebound. But decisive break will carry larger bearish implication. On the upside, above 1.1298 minor resistance will turn bias back to the upside for rebound.
In the bigger picture, with last week’s sharp decline, price actions from 1.1173 are now looking more like a consolidation that’s completed at 1.1444. Bearishness is also reflected in multiple rejection by 55 week EMA. Immediate focus is back on 1.1154/98 support zone (2016 high and 61.8% retracement of 1.0629 to 1.2004 at 1.1154). Decisive break there will confirm resumption of whole down trend from 1.2004 and long term bearish reversal. 1.0629 support will be next target.
In the long term picture, the current development argues that long term up trend has completed at 1.2004 after rejection of 1.2 key resistance. Sustained break of 1.1198 support will confirm this bearish case and target 1.0629 and possibly below.
