EUR/CHF retreats sharply from 2-month highs
|- Euro erased yesterday’s gains versus the Swiss franc.
- Volatility on end-of-month flows and weaker than expected EZ data weigh on EUR.
The EUR/CHF pair rose yesterday for the fourth day in a row and today peaked at 1.1428, hitting the highest level since November 16. Afterwards turned to the downside and around the London fix tumbled to 1.1370.
Near the end of the session is hovering around 1.1375, consolidating a retreat but still sharply higher from the level it had a week ago and firm on top of the1.1330/50 key area, suggesting that today’s slide could be seen as a bearish correction.
The move lower took place amid volatility around Swiss franc crosses and also another slide of the euro across the board. Data released today confirmed a slowdown in EZ GDP growth and showed a larger than expected decline in German retail sales. More recently ECB’s Weidmann said that the bad news regarding the German economy could continue.
EUR/CHF Levels
While above 1.1330/50, from a technical perspective the euro would look strong and favored. Resistance levels are seen at 1.1430, 1.1465/70 (Nov high) and 1.1495. A decline back under 1.1330 will likely weaken the euro significantly, exposing 1.1300; below the next support is seen at 1.1270.
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