Forex Market: EUR/CHF daily trading outlook

Yesterday’s trade saw EUR/CHF within the range of 1.2068-1.2036. The pair closed at 1.2041, down 0.14% on a daily basis.

At 7:28 GMT today EUR/CHF was up 0.01% for the day to trade at 1.2045. The pair touched held in a daily range of 1.2033-1.2046.

Fundamental view

Eurozone

Markit Economics is expected to report that activity in the Eurozones services sector grew in October at the same pace as a month earlier, with the respective Services Purchasing Managers Index projected to come in at 52.4. Meanwhile, the Markit Composite PMI will likely confirm a preliminary reading of 52.2, inching up from 52.0 in September. The reports are due at 09:00 GMT.

Annualized retail sales in the Euro region as a whole probably rose 1.2% in September, according to the median forecast by experts, after scoring a 1.9% jump in August. This would be the ninth straight month of annualized gains.

In monthly terms, retail sales probably dropped 0.8% in September, reversing a 1.2% gain a month earlier. If confirmed, this would be the sharpest decline since December 2013.

This is a short-term indicator, which provides key information about consumption on a national scale. In case the index of retail sales rises at a faster-than-projected pace, this would have a bullish effect on the euro. Eurostat is expected to publish the official data at 10:00 GMT.

Within the Eurozone, Spains services sector probably grew at a faster pace in October, with the relative Spanish Services PMI projected to come in at 56.0 compared to 55.8 in September, which would be the 12th straight monthly expansion.

Activity in Italys services sector probably contracted at a slower pace, but nevertheless for the third straight month. The Italian Services PMI, prepared by Markit, will likely register at 49.2 compared to 48.8 in September.

Frances services sector probably contracted for a second month, and at an accelerating pace. The French services PMI will likely come in at 48.1, confirming a preliminary reading, and further slowing down from 48.4 in September.

Germany, Europes leading economy, is expected to see its 17th straight month of services sector growth, albeit continuing a recent slowdown trend. The respective German Services PMI will register at 54.8 in October, according to analysts forecasts, confirming a preliminary reading but trailing Septembers final value of 55.7.

Switzerland

Annualized Consumer Price Index (CPI) in Switzerland probably fell for a second month in October, according to economists expectations. Consumer prices likely declined by 0.1% last month, extending a 0.1% deflation in September.

Month-on-month, consumer inflation accelerated by 0.1%, the same as a month earlier.

The CPI measures the change in price levels of a basket of goods and services from consumer’s perspective and also provides clues over purchasing trends. In case consumer inflation accelerated more than anticipated and approached the inflation target set by the Swiss National Bank, this would have a positive effect on the franc. The Swiss Federal Statistical Office is to release the official CPI report at 8:15 GMT.

Technical view

According to Binary Tribune’s daily analysis, the central pivot point for the pair is at 1.2048. In case EUR/CHF manages to breach the first resistance level at 1.2061, it may continue up to test 1.2080. In case the second key resistance is broken, the pair will probably attempt to advance to 1.2093.

If EUR/CHF manages to breach the first key support at 1.2029, it will probably continue to slide and test 1.2016. With this second key support broken, the movement to the downside will probably continue to 1.1997.

The mid-Pivot levels for today are as follows: M1 – 1.2007, M2 – 1.2023, M3 – 1.2039, M4 – 1.2055, M5 – 1.2071 , M6 – 1.2087.

In weekly terms, the central pivot point is at 1.2064. The three key resistance levels are as follows: R1 – 1.2089, R2 – 1.2118, R3 – 1.2143. The three key support levels are: S1 – 1.2035, S2 – 1.2010, S3 – 1.1981.