EUR/CHF Edges Higher Amid Signs of Improving Risk Appetite

EUR/CHF edged higher in early trading on Wednesday, reflecting initial signals that risk appetite is gaining traction.

The pair rebounded from a new multi-year low, which had been driven by a surge in risk aversion over the past few days due to worsening economic and geopolitical conditions. These factors provided strong support for the safe-haven Swiss franc.

A strong bounce from the new low at 0.9210 likely resulted from intervention by the Swiss National Bank, aiming to curb the national currency’s strong gains.

However, the recovery still needs to gain momentum to generate an initial reversal signal. The minimum requirement is a close above the broken Fibonacci barrier at 0.9342 (23.6% retracement of the 0.9731 to 0.9210 decline).

The daily chart remains negative, with a double death-cross of the 10/200 and 20/200 DMAs and the 14-day momentum deeply in negative territory, suggesting that the correction may be limited.

Significant barriers include the falling 10 DMA at 0.9456 and the June low at 0.9477, followed by the 50% retracement level at 0.9490. Extended upticks should stay below the upper pivot at 0.9600 (200 DMA) to maintain the prospects for a fresh push lower.

Res: 0.9425; 0.9456; 0.9477; 0.9490
Sup: 0.9342; 0.9301; 0.9285; 0.9210