FxWirePro: Trade EUR/CHF Longs On Engulfing And Uphold Short Hedges As Shooting Star Reminds Major Trend

EURCHF price has bounced back to 2-months highs, the pair has jumped from the lows of 1.0503 to the recent highs of 1.0661 levels.

Technically, it has jumped above 7, 21 & 100-DMAs with bullish engulfing formation and DMA & MACD crossovers. 

On a broader perspective, the major bearish trend most likely to resume downswings upon shooting star pattern (on dailies) and bearish engulfing candle (on monthly plotting). 

The current price remains well below EMAs with bearish crossover, as 7 & 21-EMAs cap minor upswings. 

While to substantiate this bearish stance, both leading oscillators indicate bearish momentum and lagging indicators signal downtrend to prolong further.

Trade tips:

Overall, we wish to reiterate that while interim rallies are on the cards, and the major downtrend unlikely to reverse.

Trade tips: Contemplating above technical rationale, one can execute boundary options strategy on trading grounds using upper strikes at 1.0656 and lower strikes at 1.06 levels. 

One can not only achieve certain yields but such exotic option will participate in upside as well as bearish price actions and fetch leveraged yields as compared to spot.

Alternatively, on hedging grounds, stay short in EURCHF futures contracts of mid-month tenors ahead of eurozone PMI data announcement, spot reference: 1.0623 levels (while articulating).