EUR/CHF : 1.0686






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EUR/CHF: Major wave 5 trough ended at 0.8426 and correction has commenced from there for subsequent gain towards 1.1400-1.1500.


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Although the single currency fell to as low as 1.0656 early last week, euro found decent demand there and has rallied, the pair opened higher this week and surged to as high as 1.0870, suggesting low has been formed at 1.0631 (Feb low) and consolidation with upside bias is seen for further gain to previous resistance at 1.0898, break there would provide confirmation and encourage for headway to 1.0950, then test of previous resistance at 1.0977 which is likely to hold on first testing. 
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To recap our preferred count, the decline from 1.6828 (end wave (B)) is labeled as the beginning of wave (C) which should unfold as an impulsive move with 1: 1.5326, 2: 1.6377 and wave 3 is sub-divided into (i): 1.4300, (ii): 1.5880 and wave (iii) is still unfolding with (1): 1.4577, (2): 1.5448 and wave (3) is an extended 3rd with i: 1.5006, ii: 1.5383, wave iii: 1.3073, then wave iv ended at 1.3925 and wave v at 1.3073, wave (4) ended at 1.3925 and wave (5) has ended at 1.2765 which also marked the low of wave (iii) and wave (iv) has ended at 1.3835 and wave (v) as well as larger degree wave 3 has ended at 1.0075. The selloff from 1.2650 signals wave 4 has ended there and we are taking a view that the wave 5 could also have ended 0.8426, hence consolidation is seen with mild upside bias for rebound to 1.1000 first, then towards 1.1400.
 

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On the downside, whilst pullback to 1.0800 cannot be ruled out, reckon 1.0760-70 would limit downside and bring another rise later. Only below previous minor resistance at 1.0720 would abort and suggest top is formed instead, risk weakness towards said support at 1.063. Looking ahead, a drop below previous support at 1.0622 is needed to confirm early erratic decline from 1.1201 (2016 high) has resumed, bring subsequent selloff to 1.0550 and possibly towards 1.0500.
Recommendation: Buy euro at 1.0770 for 1.0970 with stop below 1.0670.
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The long-term downtrend started from 1.9626 (Apr 1985) to 1.4166 (Sep 1995) is treated as wave (A) with A:1.6285 (Dec 1987), B: 1.9342 (May 1992) and C: 1.4166, then wave (B) ended at 1.6828 with A: 1.7147 (Feb 1997), B: 1.4398 (Sep 2001), C: 1.6828 (Nov 2007), therefore, wave (C) is now in progress with the breakdown indicated as above. This wave (C) already met indicated downside target at 1.1455/60 and 1.1300, it could have ended at 0.8426, consolidation with mild upside bias is seen for gain to 1.1000 and later towards 1.2000.
