- EUR/CHF holds above the 50-day simple moving average support.
- A move above 1.07 is needed to invalidate the bearish signs on the weekly chart.
EUR/CHF is holding above the 50-day simple moving average (SMA) support. However, for the outlook to turn bullish, the pair needs to establish a strong foothold above 1.07.
At press time, the currency pair is trading at 1.0638 and the ascending or bullish 50-day SMA is located at 1.0632.
Indeed, the daily chart is reporting a bullish cross of the 50- and 100-day SMAs. The MA studies, however, are backward-looking and unreliable. A more credible sign of bullish breakout would be a move above 1.07.
That would invalidate the buyer exhaustion signaled by the upper wicks attached to the current and the previous weekly candles and open the doors for a re-test of resistance of a two-year-long descending trendline, currently at 1.0841.
On the downside, the 100-day SMA located at 1.0608 is key support, which, if breached, would shift the focus to 1.0503 (May low).