The EUR/CHF dropped sharply in the last days after the valid breakdown from a Rising Wedge pattern. Price was somehow expected to drop more than 280 pips, so it could drop further in the upcoming period after a minor rebound. The rate is trading in the red and remains under immense selling pressure because is located below some important resistance levels (support has turned into resistance).

Personally, I believe that it could drop further because it could be attracted by a dynamic support. Actually, we have a very strong confluence area which is acting as a magnet, but we cannot exclude a minor increase right now after the impressive drop.

The Swiss Franc increased a little today, but has lost ground after the Switzerland data were sent to the public. The Trade Balance increased from 2.58B to 2.63B in the previous month, beating the 2.54B estimate, while the KOF Economic Barometer dropped much more than expected, the indicator was reported at 106.9 points in January, much below the 110.9 estimate.

Spanish Flash GDP rose by 0.7%, matching expectations, has increased less versus the 0.8% growth in the former reading period, the German Prelim CPI dropped by 0.7%, more versus the 0.5% estimate, while the French Consumer Spending decreased by 1.2%, even if the economists have expected to see a 0.4% growth.

The Euro received support only from the French Flash GDP which has increased by 0.6%, more versus the 0.5% estimate.

You can see that the rate has finally escaped from the Rising Wedge pattern, so the bearish movement was natural and expected. Price dropped much below the median line (ml) of the ascending pitchfork and could drop towards the lower median line (lml) of the ascending pitchfork. Support can be found at the second warning line (WL2) of the ascending pitchfork as well, the price could be attracted by the confluence area formed by the mentioned support levels.