EURCHF has been making lower tops and bottoms since October 26, stretching its downtrend to a three-week low of 1.1526 on Thursday. The pair is currently trading with a neutral bias on the four-hour chart, but risks remain to the downside in the short-term.
The pair is capped by the 20-period MA below the Ichimoku cloud, sending bearish signals, while the bearish cross between the Kijun-sen and the Tenkan-sen also hints that a downfall might emerge. Yet, the fact that the RSI is close to its neutral zone, pointing to an upside and the MACD has slightly deviated above its signal line, showing that the pair might move sideways for a while before it resumes its downtrend.
A support level is likely to occur at the previous low of 1.1526 before the pair moves towards 1.1483, opening the way towards October’s low at 1.1387.
On the flip side, an immediate resistance is likely to be met around 1.1583, an area where the 20-period exponential moving average and the Kijun-sen line converge. Any rise from here, would target the previous top at 1.1618 (close to the 50-period EMA), while steeper increases would shift focus towards the top of 1.1663 and October’s high at 1.1710.
