The EUR/CHF currency pair pulled back off session highs of about 1.1007 to trade at about 1.0991 in a bearish channel after the latest round of economic data.  The currency pair has been trading in a descending channel since October 28, which came off an extended rally that dated back to mid-July.

The currency pair is now pegged just below the 100-hour SMA while the 200-hour SMA is a few pips higher in the 60-min chart. This indicates a bearish bias in the market sentiment and this trend could continue through next week.

EUR/CHF Fundamentals Overview

From a fundamental perspective, the EUR/CHF currency pair is trading at the back of a major week based on the latest round of economic data. On Monday, Italian, German and French Markit Manufacturing PMIs beat expectations while the Spanish equivalent missed.

The figure for the EU economic block beat the expectation of 45.7 with 45.9 while the Sentix Investor Confidence for November improved to -4.5 from the previous rating of -16.8 in the process beating the expectation of -13.8. 

Yesterday’s German Factory Orders for September added to the optimism after beating the expectations of -6.2% with -5.4% (n.s.a) (YoY) and 0.1% with 1.3% (MoM) on a seasonally adjusted basis. Markit Services PMI and PMI Composite for Germany also beat expectations and this was mirrored in the EU economic block’s numbers, which also floored the consensus estimates.

And on Thursday, the European Commission’s latest report on GDP growth for 2020 and 2021 showed an expected annual growth rate of 2.8%, unchanged from an earlier forecast.

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

Technically, the EUR/CHF currency pair appears to be trading under strong bearish pressure as it remains constricted to a descending channel. This creates interesting cyclical trading opportunities for swing traders in the short-term.

Therefore, the bears will be targeting profits at around 1.0973 or lower at 1.0965. On the other hand, the bulls will be looking to pounce on short-term profits at around 1.1008 or higher at 1.1018.

EUR/CHF Technical Analysis (the Daily Chart)

In the daily chart, the EUR/CHF currency pair appears to be trading under significant bullish pressure as it attempts to conjure a reversal pattern after bottoming at 1.0811 in September. The currency pair has now crossed over the 100-day SMA and this could provide support for a continued bullish run.

Therefore, the bulls will be targeting long-term profits at around 1.1051, 1.1114, or higher at 1.1176. On the other hand, the bears will hope for an immediate pullback towards 1.0925, 1.0873 or lower at 1.0811.