EUR/CHF hovers at three-year highs but could lose steam.
EUR/CHF spiked higher on Thursday, stretching its up-leg started at the beginning of March to a fresh three-year high of 1.1886. While the sentiment remains positive, with prices continuing to trend above the Ichimoku cloud and all the simple moving average lines, momentum could fade in the short-term according to technical indicators.
The RSI is holding in bullish territory above 50, but the index looks weaker now after It left overbought levels earlier today. The MACD has also slowed down, falling below its red signal line, while Stochastics are moving downwards, with the green %K line set to post a bearish cross with the red %D once again.
In the event of declines, the 20-day SMA at 1.1842 could provide nearby support. Should the pair fail to hold above this level, a stronger obstacle could be met at 1.1805 where the 50-day SMA currently stands. Breaking this previous resistance area, negative pressures could strengthen with scope to retest the 1.1760 mark, another frequently visited level.
On the upside, the area encapsulated by this week’s peaks of 1.1878 and 1.1886 could be in focus since any decisive close above from this area could energise bulls, opening the door to the 1.1900 and 1.2000 key-marks.
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