EUR/CHF Technical Analysis: Green shoots of recovery ahead of SNB

• The bullish divergence of the relative strength index and stochastic and the bullish crossover on the moving average convergence divergence (MACD), as seen in the EUR/CHF daily chart, indicates the pair is gearing up for an upside break of the trendline connecting the July 16 low and Aug. 28 low.
• A close above the trendline would confirm a short-term bullish reversal and could yield a sustained move toward 50-day moving average (MA), currently located at 1.1423.
• The signs of a bullish reversal ahead of the Swiss National Bank (SNB) rate decision likely indicate that investors are expecting the central bank to strike a dovish tone. After all, the CHF has appreciated sharply in the last few weeks.

Daily Chart

Spot Rate: 1.1295

Daily High: 1.1299

Daily Low: 1.1283

Trend: Cautiously bullish

Resistance

R1: 1.1312 (trendline hurdle)

R2: 1.1343 (Sept. 11 high)

R3: 1.1423 (50-day MA)

Support

S1: 1.1267 (10-day MA)

S2: 1.1223 (Sept. 18 low)

S3: 1.1183 (Sept. 7 low)