EURCHF is currently in the region of the multi-year low of 1.0504 restricted by the flattened Ichimoku lines. Despite negative pressures from the simple moving averages (SMAs) – specifically the 50-period SMA – and the Ichimoku cloud, the price is engaging with the red Tenkan-sen line, hoping to overtake it and build some positive backing.
Though the Ichimoku lines and all SMAs reflect a paused picture with dried up momentum, the short-term oscillators suggest that positive momentum could be picking up. The RSI, in the bearish zone is improving towards its 50 level, while the stochastic lines pushed out of the oversold region maintaining their bullish tone. Moreover, the MACD in the negative section has moved slightly above its red trigger line adding some optimism.
If buyers push over the Ichimoku lines, initial resistance could occur at the 100-period SMA of 1.0536, where the falling 50-period SMA and the lower band of the cloud lie. Moving above, the 200-period SMA currently at 1.0556 may obstruct the pair from reaching the tough 1.0564 high. Breaching this could shoot the price to test the peaks from 1.0584 until 1.0621.
Should sellers fail to move over the red Tenkan-sen line, initial support may come from the 1.0511 to 1.0504 area of lows. Stepping below this border, the price may drop towards the 1.0455 support ahead of the 1.0424 trough of July 2015.
Summarizing, the picture maintains a flat mode below 1.0652. That said, a close either above 1.0621 or below the base of 1.0504 would be required to set the next direction in the neutral-to-bearish short-term outlook. Yet, only a move above 1.0709 may turn things bullish.
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