EUR/CHF has rallied from December 2023 lows but faces resistance at the 50-week Simple Moving Average (SMA). Despite recent strength, the long-term downtrend may still be intact.
Conflicting Signals:
- Bearish Indicator: The 50-week SMA continues to act as strong resistance, suggesting a potential pullback.
- RSI Convergence: Bullish momentum is indicated by RSI convergence, although the pair is now overbought.
- Trendline Break: A break above the trendline hints at a possible intermediate bullish trend.
Technical Outlook:
- Symmetrical Triangle: A breakout pattern suggests short-term indecision, with potential for both upside and downside movement.
- RSI Retreat: Decline in RSI during triangle formation suggests underlying weakness.
- Short-term Uptrend: Recent price action indicates a possible short-term uptrend.
Key Takeaways:
- Market Uncertainty: Conflicting signals create an unclear outlook.
- Watch for Breakouts: The Symmetrical Triangle’s resolution will determine the near-term direction.
