EUR/CHF Sellers Gain Momentum After Breaking Key Support
Market Overview
Investors remain cautious ahead of key central bank meetings, including the Federal Reserve and the Swiss National Bank (SNB), as recession concerns and trade war fears heighten expectations for further rate cuts. The Euro, which has shown strong performance in recent weeks, faced selling pressure on Tuesday as traders booked profits ahead of the SNB’s policy decision.
Technical Analysis
On the four-hour chart, EUR/CHF has reversed from its recent rally near the 0.96620 resistance level, signaling renewed selling pressure. The pair has broken below the key support at 0.95636, placing it on track for the next downside target at 0.95368. A further breakdown could expose the next major supports at 0.95028 and 0.94652, aligning with the 161.8% and 200% Fibonacci extension levels, respectively.
Momentum indicators confirm the bearish outlook. The RSI is trending lower, reflecting increased selling pressure, while the MACD histogram remains in negative territory, suggesting sustained downside momentum. For a bullish reversal, buyers would need to reclaim control above the short-term resistance at 0.96012 and push beyond 0.96620 to invalidate the current bearish bias.
Key Technical Levels
- Resistance 1: 0.96012
- Resistance 2: 0.96620
- Support 1: 0.95368
- Support 2: 0.95028
- Support 3: 0.94652
Fundamental Drivers
Market participants are awaiting key Eurozone inflation data and the German bond auction results, both of which will be released later today. Additionally, speeches from two senior European Central Bank (ECB) officials could provide insights into future monetary policy.
However, the primary event of the week remains Thursday’s SNB meeting, where the central bank is expected to cut rates by 25 basis points. Any deviation from expectations could trigger sharp movements in EUR/CHF. Traders will closely watch the SNB’s forward guidance for further clues on future rate policy.
Conclusion
EUR/CHF remains under bearish pressure after breaking key support, with sellers targeting 0.95368 and potentially 0.95028. A recovery above 0.96012 could slow downside momentum. Upcoming Eurozone inflation data and the SNB rate decision will be key catalysts for the pair’s next move.
Find us on
