EUR/CHF formed a short term top at 0.9485 last week and fell sharply since then. Though, the selloff stabilized after hitting 38.2% retracement of 0.8979 to 0.9485 at 0.9292. Initial bias is turned neutral this week first. On the upside, break of 0.9371 will bring stronger rebound back to retest 0.9485 high. However, sustained break of 0.9292 will raise the chance of bearish reversal, and target 61.8% retracement at 0.9172.
In the bigger picture, rise from 0.8979 medium term bottom is at least reversing the fall from 0.9928 (2024 high), with prospect of developing into a medium term up trend. Further rally should be seen to 0.9660 resistance next. This will remain the favored case as long as 0.9264 resistance turned support holds. However, decisive break of 0.9264 will argue that rise from 0.8979 might have complete as a three wave corrective move already, and revive medium term bearishness.
In the long term picture, the break of 0.9407 support turned resistance (2022 low) suggests that down trend from 1.2004 (2018 high) might have completed with five waves down to 0.8979. This is supported by bullish divergence condition in both W and M MACD. Further rise should be seen to 55 M EMA (now at 0.9632). Firm break there will pave the way to 38.2% retracement of 1.2004 to 0.8979 at 1.0135 in the medium term.
