EURCHF Is Approaching a Retest Zone and Is Expected to Continue Its Bearish Trend

EURCHF Analysis – Price Is Approaching a Key Level at 1.07700 Where It Will Retest to Go Lower

EURCHF is approaching a retest zone at 1.07700 to drop lower. Price returned to a bearish trend on the 12th of August after a major rejection at 1.09050, a key significant zone. Thereafter, the market has struggled to maintain its bearish trend. EURCHF then falls into consolidation and is now making a retest at 1.07700. The market consolidation is between the 1.07700 resistance level and the 1.07000 support level. Price looks eager to gain more bullish strength as it maintains its accumulation level.

EURCHF Key Levels

Resistance Level: 1.00770, 1.09050
Support Levels: 1.07000, 1.08350
After a retest of the 1.09050 resistance key level, the market began to move in a bearish direction. This trend gains strength after accumulating between the 1.08350 and the 1.07700 key levels. Thereafter, price breaks out in a bearish direction. There appears to be bullish strength as the market begins approaching the 1.07700 key level. From this point, EURCHF may retest, break lower, and continue in its bearish direction, or the price may just continue in its consolidation phase.

However, the market continues to make a significant range between the two levels (the 1.07700 resistance and the 1.07000 support). There appears to be a cross on the Stochastic Oscillator at 40.00. This indicates that there will be some bullish momentum before the bearish trend resumes. This is even though the Parabolic SAR (Stop and Reverse) indicator already has three dots above the daily candles, which already points the market along with the major bearish trend.

Market Expectations

On the 4hr chart, there appears to be some bullish momentum as the Stochastic Oscillator continues to soar up close to the 80.00 region. At this level, there is likely to be an indication of a cross that will signal the end of the bullish movement.

The parabolic SAR also shows bullish momentum as the candlestick is approaching the 1.07700 key resistance zone. As the oscillator approaches the overbought region on the 4hr chart, the price continues to react at the 1.0770 resistance before being distributed downward towards 1.06500.

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