EURCHF recently reached a 14-month high of 0.9928 before experiencing a sharp decline towards the 50-day SMA. This drop was accompanied by momentum indicators turning bearish, signaling a potential shift in the market sentiment. Despite the ongoing recovery since late December in an attempt to erase the significant downtrend from 2021-2023, the pair faced resistance at the recent peak.
Support and Resistance Levels
If the current weakness persists, EURCHF could breach the 50-day SMA and test the support level at 0.9768. Further downward movement might find a floor at the May bottom of 0.9725, with additional support at the April level of 0.9675. On the other hand, a bullish scenario could see resistance at 0.9836 and 0.9847, with a potential breakout leading to a retest of the 14-month high at 0.9928.
Market Outlook
EURCHF is currently under pressure as it faces resistance after hitting a 14-month high. The 50-day SMA is acting as a critical level to watch, providing a barrier against further decline. As the market anticipates the ECB’s rate decision, heightened volatility is expected in the coming days, adding uncertainty to the pair’s future movements.
By closely monitoring the technical indicators and key support/resistance levels, traders can better navigate the fluctuations in EURCHF and position themselves accordingly in response to changing market dynamics.