EUR/CHF Weekly Outlook

EUR/CHF rebounded to 0.9878 last week but retreated since then. Initial bias is turned neutral this week for consolidations first. A short term bottoming should be in place at 0.9774 on bullish convergence condition in 4H MACD. Hence, risk will stay on the upside as long as 0.9774 holds. Also, the development revived the case that whole correction from 1.0095 has completed at 0.9704. Break of 0.9878, and sustained trading above 55 D EMA (now at 0.9875) will affirm this bullish case, and target 0.9995 resistance next.

In the bigger picture, prior rejection by 55 W EMA (now at 0.9989) and 38.2% retracement of 1.1149 to 0.9407 at 1.0072 suggests that medium term outlook is staying bearish. That is, down trend from 1.2004 is not completed yet and is in favor to resume through 0.9407 at a later stage. However, decisive break of 1.0095 resistance will raise the chance of bullish trend reversal. Rise from 0.9407 should then target 1.0505 cluster resistance (2020 low at 1.0505, 61.8% retracement of 1.1149 to 0.9407 at 1.1484).

In the long term picture, it’s still way too early too call for bullish trend reversal with upside capped well below 55 M EMA (now at 1.0566) and 1.0505 support turned resistance (2020 low). The multi-decade down trend could still continue.

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