- EUR/CHF edges higher from 8-month lows at 1.1368, trades 0.55% higher on the day.
- The pair has retraced break below 38.2% Fib at 1.1476 and is currently trading shy of 5-DMA at 1.1527.
- Momentum studies are biased lower and bearish divergence keeps scope for further downside.
- Recovery lacks traction and we see bearish bias intact as long as trendline resistance at 1.1570 holds.
- Euro supported as Italy’s anti-establishment 5-Star Movement and far-right League push towards formation of a government.
- Further, data shows sentiment across the European continent is holding high. But it is worth noting that the survey period is before the recent turmoil.
- Momentum studies are biased lower and bearish divergence keeps scope for further downside.
- On the flipside, 5-DMA is immediate resistance. Retrace above 200-DMA invalidates bearish bias.
Support levels - 1.1476 (38.2% Fib), 1.1446 (2018 low), 1.14, 1.1388 (Oct 2 lows), 1.1313 (50% Fib)
Resistance levels - 1.1530 (5-DMA), 1.1650 (200-DMA), 1.1678 (23.6% Fib)
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