Will the Euro Stage a Comeback Against the Swiss Franc?

Overview

The EUR/CHF has been in a downtrend since the beginning of the year, starting around 1.009 in zone 3 and dropping to 0.9798 in zone 2. The downward pressure may be attributed to factors such as the European Union’s vaccination progress and the relatively weaker economic recovery in Switzerland.

Technical Analysis

The EUR/CHF has formed lower lows and lower highs, indicating a clear bearish trend since the start of the year. Recently, the pair broke through the 0.9855 area into B – zone 2 and tested support at 0.9798. Currently, the pair is in between resistance at 0.9855 and support at 0.9798.

Fundamental Analysis

According to the most recent CFTC data analysis report, large speculators have become increasingly bullish on the Euro. Short-term trends favor the Swiss Franc at 11% to 17%, but long-term trends are in favor of the Euro at 84% to 45%. Net long positions for the short-term are at 5039 to 1060, and for the long-term, they are at 169400 to -3656, both of which also favor the Euro. These figures suggest a growing bullish sentiment towards the Euro, which could indicate a sustained uptrend for the Euro.

Trade Plan Based on both technical and fundamental factors, I’ll focus on EUR/CHF pair as it may likely continue its upward trend in the near term. However, traders should exercise caution, utilize proper risk management techniques, and follow their trade plan. It’s wise to avoid being an early bull who may get caught by the bears. The upcoming ECB meeting and news releases may provide further direction for the Euro, and traders should stay informed

Disclaimer

This video is for educational purposes only and is not intended to be investment advice. Any trades made are at your own risk, and it is recommended that you consult with a financial professional before making any investment decisions. The opinions expressed in this analysis are based on the Phase Space Strategy and should not be taken as investment advice.

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