Bullish Momentum Begins to Resume After a Technical Pullback

Central Bank

Economic

Summary:

This positioning follows a clean bounce off a recent low at the 34 level, showing that the RSI is well-placed to sustain a continued upward move.

BUY EURCHF

EXP

TRADING

0.92017

Entry Price

0.93250

0.91000

0.91989 -0.00014 -0.02%

0.0

Pips

Flat

0.91000

Exit Price

0.92017

Entry Price

0.93250

In Europe, the Sentix Investor Confidence index for June improved to -13.4 points from the -16.4 logged in May, achieving its best result in three months but remaining far from leaving negative territory. At the same time, German factory orders dropped by 3.8% month-over-month in April after increasing by 4.5% in March, coming in worse than the 1.2% decline expected by experts. Meanwhile, the EU economy grew by 0.1% quarter-on-quarter in the first quarter of 2026, slowing down from the 0.2% and 0.3% growth rates recorded in the fourth and third quarters of 2025, respectively, which hints at an ongoing economic cooling amid rising prices. This occurs as the HICP reached 3.2% year-over-year, driven mainly by the energy shock tied to the conflict in Iran. Along the same line, the latest inflation figures from the Eurozone continue to support ongoing concerns regarding persistent price pressures.

The Producer Price Index (PPI) logged a monthly increase of 0.6% in April, following a significant 3.4% jump in March, which came in higher than market expectations. On a year-over-year basis, producer price growth accelerated to 4.9%, up from the revised 2.0% reading in the previous month. Similarly, the underlying core Harmonized Index of Consumer Prices (HICP) increased at an annual rate of 2.5% in May, moving up from the 2.2% reported in April and beating the consensus market forecast of 2.4%. Given this backdrop, monetary policymakers at the European Central Bank (ECB) remained vocal about their intentions to raise interest rates due to sticky inflation pushed by energy supply disruptions. Officials including Wunsch, Šimkus, Stournaras, Schnabel, and Nagel, among others, explicitly support a rate hike in June at the upcoming policy meeting.

In Switzerland, consumer price data disappointed the market. The Consumer Price Index grew by just 0.2% month-over-month in May, missing the 0.3% expected forecast, while the annual inflation rate remained stuck at 0.6%, landing well below the market consensus of 0.8%. For the Swiss National Bank (SNB), which has been trying to prevent an excessive appreciation of the franc in a low-inflation environment, these numbers should have helped lower the demand for the currency. However, exactly the opposite occurred.

The persistent strength of the Swiss franc continues to be a main challenge for the SNB. With its benchmark interest rate set at 0% and inflation tracking near minimum levels, the institution has made it clear that it prefers to intervene in the foreign exchange market rather than return to negative interest rates. The weak inflation data published on Thursday added weight to the arguments for a more flexible monetary policy ahead of the June meeting and even brought back the possibility of negative rates. Nevertheless, investors looked past these signals and continued to build up positions in Swiss francs. In practice, the market actively went against the central bank's stance, pushing up a currency that keeps gaining value despite the efforts of officials to curb its strength, on a day when the fundamentals seemed to point in the opposite direction. Bullish Momentum Begins to Resume After a Technical Pullback_1

Bullish Momentum Begins to Resume After a Technical Pullback_1

Technical Analysis

From a chart perspective, EUR/CHF is currently recovering the horizontal support level located at 0.9151 following a downward correction that reached the 0.618 Fibonacci area. Because the price printed a strong upward reaction immediately after touching these technical markers, this recent decline looks like a temporary pullback rather than a full change in trend direction. Meanwhile, the 100 and 200-period Moving Averages are running at 0.9154 and 0.9231, respectively. Since the price managed to secure a close above the 100-period moving average line, the upward momentum has the potential to speed up toward the 0.9325 area, which functions as the next major horizontal resistance ceiling.

A review of the momentum oscillators provides further cross-verification for this resuming upward path. The Relative Strength Index (RSI) is currently tracking at the 59 level, sitting comfortably inside positive territory but still leaving plenty of open chart space before entering overbought conditions. This positioning follows a clean bounce off a recent low at the 34 level, showing that the index is well-placed to sustain a continued upward move.

At the same time, the MACD indicator is showing a positive histogram that is steadily gaining upward depth, while its signal lines have already crossed above the neutral zero line. This combination of factors suggests that the buyers are regaining steady control of the market, making the upward direction the path of least resistance for the pair.

Trading Recommendations

Trading direction: Buy

Entry price: 0.9202

Target price: 0.9325

Stop loss: 0.9100

Validity: Jun 19, 2026 15:00:00

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Bullish Momentum Begins to Resume After a Technical Pullback

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