EURCHF is consolidating after the rebound from the all-time low of 0.9552 ran out of steam. The momentum indicators are portraying split views on the next direction. The %K and %D lines of the stochastic oscillator are both sloping downwards, heading for oversold territory. But the MACD histogram is on the verge of turning positive for the first time since mid-June.
The recent peak of 0.9865 is an obvious target for the bulls in any fresh upside attempt. However, there is stiff resistance from the 50-day moving average (MA), which has just intersected the 23.6% Fibonacci retracement level of the June-August downleg at 0.9779.
Should the bulls manage to overcome this hurdle and surpass the September high of 0.9865, attention would then turn to the parity level, with the 50% Fibonacci of 1.0032 providing additional resistance in the area.
If, though, EURCHF loses further positive momentum, the 20-day MA just above the 61.8% Fibonacci retracement of the August-September upleg at 0.9672 could halt further declines. Otherwise, the price could slide until the record-low of 0.9552, and if this is breached too, the 161.8% Fibonacci extension of 0.9358 would be the next possible all-time low to watch.
Summing up, EURCHF looks set to maintain its sideways trend in the short term, especially if it becomes increasingly confined by its 20- and 50-day MAs. However, in the medium-term picture, only a bounce above the parity level would help switch the current bearish outlook to a neutral one.
