EURCHF Consolidation Hints at Market Redistribution

Market Analysis – August 25

The EURCHF currency pair is currently undergoing a phase of consolidation, marking a notable shift in market dynamics after an extended period of downward movement.

EURCHF Key Levels:

• Demand Levels: 0.9550, 0.9370, 0.9300
• Supply Levels: 0.9650, 0.9730, 0.9840

Long-Term Trend for EURCHF: Bearish

A meticulous examination of the daily chart reveals a distinct pattern in recent price actions, characterized by a series of bearish tests. The fourth attempt at such a test prompted escalated selling pressure, leading to a subsequent price decline. Particularly noteworthy is the convergence of the 89-period and 200-period Moving Averages, which occurred prior to a critical evaluation of the bearish trendline. This alignment further substantiates the potential viability of short positions in the market.

Furthermore, the market’s endeavour to rebound in June, marked by a retracement to the Moving Averages, was met with resistance that triggered a reversal. The Stochastic indicated an overbought market state, subsequently facilitating a decline to the 0.9550 level. August has witnessed a lateral price movement, indicating a phase of market redistribution and the establishment of a new equilibrium.

Short-Term Trend for EURCHF: Bearish

A meticulous analysis of the 4-hour chart provides further support to the narrative of consolidation. The Stochastic indicator’s clear overbought condition within this timeframe suggests an imminent corrective downward movement, with a projected decline toward the 0.9550 level.

Do you want to take your trading to the next level? Join the best platform for that here