The EUR/CHF dropped sharply today and looks determined to erase the yesterday’s impressive gains, remains to see what will happen in the upcoming period because the rate is approaching an important dynamic support. Technically was expected to increase further, but remains to see what will happen in the upcoming days because the bulls seem a little exhausted.
The Euro is losing significant ground, even if the Euro-zone data have come in mixed, we had some good data, but there were some figures that have disappointed. Price maintains a bullish perspective, despite the current drop, could retest a dynamic support before will climb much higher on the short term.
Surprisingly or not, the Swiss Franc has rallied even if the Switzerland Trade Balance has dropped from 3.04B to 1.97B in April, was reported much below the 2.87B estimate. The Euro was punished by the Euro-zone Flash Services PMI, which has decreased from 56.4 points to 56.2 points in May, even if the traders have expected to see an increase to 56.5 points, the minor decrease has signalled that te expansion has slowed down, while the German Flash Services dropped from 55.4 to 55.2 points in the current month, despite that the economists have estimated an increase to 55.5 points. Moreover the French Flash Manufacturing PMI has disappointed as well, has dropped from 55.1 to 54.0 points, while the estimate was 55.2 points.
Price has dropped aggressively and has failed to approach and reach the 150% Fibonacci line (descending dotted line), this line represents a very strong resistance level, you can see that has rejected the rate in the last breakout attempt. Right now is approaching the median line (ml) of the minor ascending pitchfork (black ascending line), could climb higher again if the dynamic support will hold.
Was expected to climb much higher after the retest of the upper median line (UML) of the major descending pitchfork, the median line of the minor ascending pitchfork and the sliding line (sl) of the major ascending pitchfork, the perspective remains bullish as long as is trading above these obstacles.