July 5th was the last time that EUR/CHF traded at 1.0000. The pair traded lower in an orderly channel until the pair broke above it on August 29th near 0.9629. EUR/CHF then hugged the top trendline of the channel, while still moving lower, making a local low at 0.9409. Since then, the pair has been moving higher in a flag formation. On October 13th, EUR/CHF broke out of the flag pattern. The target for a flag pattern is the height of the flagpole, added to the breakout point of the flag. In this case, the target is near 1.0015.
EUR/CHF has been moving higher 10 of the last 11 trading days, including today. If price is to make it to target, the first resistance is the 50% retracement level from the highs of June 9th to the lows of September 26th at 0.9962. Above there, resistance is at the psychological round number level of 1.0000. If price makes it to the target and continues higher, the next resistance level is the 61.8% Fibonacci retracement level at 1.0092.
However, notice the RSI has just moved into overbought territory, indicating that EUR/CHF may be ready for a correction. If the pair does correct, the first support level is the low from October 12th at 0.9644 and then the September 26th lows at 0.9409. If EUR/CHF breaks below, there is no support until the lows from January 2015 when the SNB dropped the 1.2000 peg to the Euro, near 0.8630!
If EUR/CHF can’t make it above parity, watch the RSI. If it is still in overbought territory, the pair can fall to 0.9644 quickly!
EUR/CHF has been moving higher 10 of the last 11 trading days, including today. If price is to make it to target, the first resistance is the 50% retracement level from the highs of June 9th to the lows of September 26th at 0.9962. Above there, resistance is at the psychological round number level of 1.0000. If price makes it to the target and continues higher, the next resistance level is the 61.8% Fibonacci retracement level at 1.0092.
However, notice the RSI has just moved into overbought territory, indicating that EUR/CHF may be ready for a correction. If the pair does correct, the first support level is the low from October 12th at 0.9644 and then the September 26th lows at 0.9409. If EUR/CHF breaks below, there is no support until the lows from January 2015 when the SNB dropped the 1.2000 peg to the Euro, near 0.8630!
If EUR/CHF can’t make it above parity, watch the RSI. If it is still in overbought territory, the pair can fall to 0.9644 quickly!