EURCHF has been trading in a relatively narrow range between 1.1385 and 1.1305 from late January onwards, while the past few days the market action has stretched further below the 20- and 40-day simple moving averages (SMAs). Momentum oscillators are losing ground, with the RSI falling below its neutral 50 level and the stochastic dropping into the oversold zone.
Potential declines beneath the 1.1305 level could meet support near the 1.1240 low, identified on January 15. If the bears violate that area, that would turn the bias to cautiously negative, opening the door for a test of 1.1180 – the January 3 low.
On the other hand, advances in the market may stall near the 20- and the 40-SMA currently at 1.1346 and 1.1355 respectively. Even higher, the 1.1385 level, which holds near the 38.2% Fibonacci of the downleg from 1.1710 to 1.1180 would be eyed with another break above that hurdle shifting the focus up to the 1.1440 resistance, registered on February 5.
In the medium-term picture, the market is also neutral, with the price action taking place within a wider range of 1.1180 -1.1500 since August.
Concluding, a violation of 1.1445 could signal more advances, while a move below 1.1305 may be the trigger for more declines.
Signal2forex.com - Best Forex robots and signals
