The EUR/CHF currency pair on Thursday plunged to set new 6-week lows following the latest round of economic data from Germany. The currency pair has been trading in a downward movement since completing a consolidative bullish triangle pattern that triggered a reversal.
This week, the currency pair has plunged from a high of about 1.0986 to bottom at around 1.0863 before failing in an attempted recovery late on Thursday.
EUR/CHF Fundamentals Overview
From a fundamental perspective, the EUR/CHF currency pair is trading at the back of a busy period in the EU market. On Thursday, the preliminary German GDP for Q3 came out better than expected with (QoQ) change of 0.1% versus -0.1%. The (YoY) equivalent also outperformed the expectation of 0.9% with 1.0%.
In Spain, the Consumer Price Index for October was in line with expectations of 1% (MoM) and 0.1% (YoY) while French inflation ex-tobacco improved from -0.3% change in the previous period to 0.0% (MoM) for October. The French CPI also matched the expectations of -0.1% (MoM) and 0.9% (YoY).
On the other hand, Switzerland’s Producer and Import prices for October missed the expectations of -0.1% (MoM) with -0.2%, and -1.9% (YoY) with -2.4%.
Overall, the preliminary GDP for the EU economic block beat the annual estimate of 1.1% with 1.2% while the quarter-over-quarter outcome was in line with expectations. However, the (QoQ) employment change for Q3 missed the expectation of 0.2% with 0.1%.
EUR/CHF Technical Analysis (the 60-min Chart)
Technically, the EUR/CHF currency pair appears to be trading under strong bearish pressure in a diving swing which came following a crucial breakout from a descending channel. The currency pair has recently bounced off oversold levels after the latest rebound and this puts it on par for both the bulls and the bears to pounce.
The bulls will be targeting short-term profits at around 1.0886 or higher at 1.0903. On the other hand, the bears will look to retain control in the short-term trading market by targeting profits at around 1.0862 or lower at 1.0849.
EUR/CHF Technical Analysis (the Daily Chart)
In the daily chart, the EUR/CHF currency pair continues to trade under intense bearish pressure in the descending channel. This pattern formation follows a lengthy sideways movement between August 2018 and April 2019 that failed to yield a reversal.
Therefore, as the bears continue to control the long-term movement in the currency pair, they will be targeting profits at around 1.0808, 1.0754, or lower at 1.0642. On the other hand, the bulls will hope for a quick reversal towards 1.0923, 1.0966, or higher at 1.1065.