EUR/CHF Bounces Off Multi-Month Lows Amid Intense Bearish Pressure

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The EUR/CHF currency pair on Friday plunged to touch a new multi-month low of about 1.0823 before bouncing back to top 1.0850 in mid-day. The currency pair is now trading slightly below today’s session highs as it remains under intense bearish pressure early on in the year.

The Euro appears to be lacking enough fundamental backing to trigger a major reversal amid a quiet period from the perspective of the latest economic data.

EUR/CHF Fundamentals Overview

From a fundamental perspective, the EUR/CHF currency pair is trading at the back of a relatively quiet period in both the EU and Swiss markets. However, traders did receive some data on Monday and Thursday that could provide guidance for trading heading into the tail end of the week.

On Monday, the Spanish GDP for Q3 2019 missed the (YoY) expectation of 2.0% with 1.9% while December CPI also came short of 0.9% expected with 0.8%. On the other hand, the Swiss KOI Leading Indicator for December beat the expectation of 94.5 with 96.4.

On Thursday, the Markit Manufacturing PMI for Spain, Germany, and France beat the expectations of 47, 50.3, and 43.4 with 47.4, 50.4 and 43.7, respectively while Italy’s equivalent missed 47.2 with 46.2. On the other hand, the EU economic block’s Markit Manufacturing PMI beat the expectation of 45.9 with 46.3.

EUR/CHF Technical Analysis (the 60-min Chart)

Technically, the EUR/CHF currency pair appears to be trading under intense bearish pressure on course to complete a double-top XABCD pattern. The pair has dropped below the current level of the 100-hour and the 200-hour SMA lines. Today’s rebound pulled it off oversold levels of the RSI indicator in the 60-min chart.

Therefore, the bears will be targeting short-term profits at around 1.0823 or lower at 1.0800 while the bulls will look to pounce by targeting profits at around 1.0850 or higher at 1.0862. 

EUR/CHF Technical Analysis (the Daily Chart)

In the daily chart, the EUR/CHF currency pair appears to be trading in a descending wedge, which indicates a long-term bearish bias in the market sentiment. The currency pair has recently dropped to test the key support level at 1.0830 which appears to be holding firm.

Therefore, the bulls will be targeting rebound profits at around 1.0902, 1.0988, or higher at 1.1059. On the other hand, the bears will hope that the support is breached by targeting profits at around 1.0776, 1.0689 or lower at 1.0624.

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