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EUR/CHF: Downside Bias Remains | Seeking Alpha

EUR/CHF: Downside Bias Remains | Seeking Alpha

In a current article posted on December 18, 2018, I predicted that the EUR/CHF foreign money pair would fall to 1.12000. On the time it was buying and selling at round 1.12600. At present, it’s buying and selling at round 1.12300, after some short-lived upside within the days instantly following my article.

Additional, on December 28, 2018, the pair noticed an intra-day low of 1.12149; very near my 1.12000 goal. On this article, I reinforce my prediction that the EUR/CHF will hit 1.12000 within the brief time period. Along with this goal, I consider that the pair will goal 1.11850, which was the intra-day low set on September 10, 2018.

The chart under exhibits EUR/CHF on the day by day candlestick chart, juxtaposed with the SXY (a Swiss franc foreign money index, courtesy of TradingView.com) and EXY (a euro foreign money index, additionally courtesy of TradingView.com). Within the first occasion, we will discover that the Swiss franc index (marked in purple) is making larger highs and better lows. The euro index (marked in blue) in the meantime sunk to a decrease low (when it comes to the previous few buying and selling days).

EUR/CHF: Euro Struggling vs. Swiss Franc

(The chart above was created by the writer utilizing buying and selling instruments offered by TradingView.com. The identical applies with respect to all additional charts introduced on this article hereafter.)

Whereas a longer-term perspective can also be necessary, the speedy short-term doesn’t look favorable for the EUR/CHF pair. Not solely is the Swiss franc index making headway (to the upside), however the euro can also be concurrently flat-lining. The EUR/CHF pair itself is subsequently dropping, and the spherical 1.12000 degree stays in sight.

The chart under illustrates the present worth of EUR/CHF in relation to each the 1.12000 degree (marked in purple) and the 1.11850 degree talked about earlier on this article. The 1.11850 degree strains up with the intra-day lows discovered on September 7, 2018 and September 10, 2018. Judging by the current worth motion of EUR/CHF, the writer believes that this degree is a possible short-term goal for EUR/CHF.

EUR/CHF Target of 1.11850

I’m not assured as to how this pair may transfer after dropping to those ranges. A brief-term retracement would in all probability be on the playing cards, drawing from the pinpoints of 1.13145 and 1.11850 (as proven under). This might point out a possible future upside retracement (on the zero.618 degree, as indicated within the Fibonacci diagram under) of 1.12650.

EUR/CHF Fibonacci Retracement PotentialsWord that any retracement could also be restricted to the zero.500 degree on the Fibonacci diagram, which might recommend a potential upside retracement to 1.12497 as an alternative (that’s, after first falling to the 1.11850 degree). In abstract although, whereas additional draw back might be in retailer for EUR/CHF, the fast draw back potential is now extra restricted than earlier than.

Subsequently, merchants who’re brief EUR/CHF might want to think about decreasing their place sizes at this juncture. However, a longer-term and decrease goal of 1.10885 is conceivable. This strains up with the intra-week excessive of 1.10885 achieved in the course of the week commencing July 17, 2017 (as indicated on the weekly candlestick chart under, per the dashed black line).

EUR/CHF Long-term Short TargetThe market is certainly presently demonstrating a willingness to check this 1.10885 degree, which might characterize a return to EUR/CHF’s earlier buying and selling vary which started in August 2015 and carried by way of to July 2017 (when worth ranged from round 1.06000 to 1.11992.

A contact (and revisit) to the highest of this earlier buying and selling vary on the 1.12 is what I’ve already been predicting. However I definitely wouldn’t discover a return to the 1.10885 unsurprising both. As all the time, as worth updates over the subsequent week or so, we could have additional context with which to make one other spherical of predictions.

For now, I stay bearish on EUR/CHF, with a direct worth goal of 1.12000 and a subsequent short-term goal of 1.11850.

Disclosure: I/we now have no positions in any shares talked about, and no plans to provoke any positions inside the subsequent 72 hours. I wrote this text myself, and it expresses my very own opinions. I’m not receiving compensation for it (aside from from Seeking Alpha). I’ve no enterprise relationship with any firm whose inventory is talked about on this article.

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