Investors are still looking forward to hear the good news from the European leaders, but there are still many disagreements between Germany and France. All eyes are on the ECB press conference on Thursday and until then the markets are expected to stay calm.
I have been following this pair for several weeks and it makes a good example for implementing the reversal technique. After the false-break occurred above 0.93, I estimated that the pair would correct down to 0.91 and turn over again. Eventually, it found the support at 0.905 and made the reversal pattern as I estimated. Yesterday's break-up at 0.92 was a strong signal that the reversal is strong and the pair's important test is to try to break-through 0.93 again. If it succeeds, it might continue to 0.95 and above.
The weakness of the CHF against the USD reflects in the pair USD/CHF. The fact that the EUR is strengthening against the CHF, in spite the bearish momentum of the EUR indicates that the CHF weakness is relatively higher. The pair got the support of the 200 SMA on the daily chart and it is now approaching the resistance at 1.245, which it has failed to break during the last two months. Therefore, there are good chances that it will fail again and turns over towards 1.22. However, a successful break-up will trigger many automatic orders that might lift the pair to 1.27.