Hello traders! Below is the EUR/CHF Daily chart, where we can witness a very consistent downtrend over the course of 16 months. All major support level was taken out and the pair continues to fall.
As we can see, most of the time EUR/CHF stayed below the 200 Exponential Moving Average and this week it approached the 50 Moving Average. It failed to touch the 50 MA and once again price started to move lower.
On the 4H chart, the pair rejected the 200 EMA. It attempted to break above, although only produced spikes about without being able to close above with confidence.
At the same time, EUR/CHF rejected the upper trendline of the extended descending channel. Overall, it is still a valid downtrend and price should potentially be heading towards new lower lows in the coming days.
Below is another chart on the 15M timeframe. Just look at the massive resistance formed near 1.0700 psychological areas. There were some strong buying volumes at bottoms indicating that price can start reversing to the upside. However, the pair failed to break resistance on 4 occasions, which is a strong indication of sellers still controlling EUR/CHF. After the 4th rejection, EUR/CHF went down sharply and broke below the descending channel as well as 200 EMA.
All-in-all it is a downtrend, and price can drop as far as 1.0546, which is 161.8% Fibonacci retracement level applied to the most recent corrective wave up. But at the same time, break and close above the 1.0710 will immediately invalidate downtrend continuation and can lead to the beginning of consolidation or even a trend reversal.
Bias: Strongly bearish while below 1.0710
Potential Resistance Zone: 1.0700-1.0710
Potential Targets: 1.0550
Have a profitable trading!