FxWirePro: EUR/CHF rejected at session highs, break below cloud to see further weakness

EUR/CHF chart on Trading View used for analysis

• EUR/CHF edges lower from session highs at 1.1392, bias bearish. Recovery attempts lack traction and are capped at daily cloud.
   
• Momentum studies are biased lower and RSI is below 50 levels. We see scope for further weakness.
   
• Upside was rejected at stiff resistance at 110-EMA and has broken strong trendline support at 1.1390.
   
• The pair has slipped below major moving averages and dipped into daily cloud. Break below cloud will see test of 1.1271 (Aug 15 low).
   
• German and Eurozone GDP data due later in the EU session could influence price action.
   
• German economy is likely to have contracted 0.1% q/q in Q3, following a 0.5 percent expansion in the previous quarter. An above-forecast reading may put a bid under the EUR. 
   
• That said, Italy-EU standoff continues to weigh on the pair and hence upside could be short-lived.
   
• We see upside continuation only on decisive breakout at 110-EMA.

Support levels - 1.1341 (cloud base), 1.13, 1.1271 (Aug 15 low)

Resistance levels - 1.1394 (cloud top), 1.14, 1.1449 (110-EMA)

For details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex.