- Risk aversion, rising energy prices in Europe and supply bottlenecks weigh on the EUR / CHF.
- Swiss franc among top performers on Wednesday.
- Breaking below 1.0700 would open the doors of EUR / CHF towards 1.0660
After a break on Tuesday, the EUR/CHF It resumed the slide and fell to 1.0706, reaching the lowest intraday level in a month. The euro has been unable to break out of the lows and continues to look towards the 1.0700 area, a critical support.
A breakout and confirmation below 1.0700 should clear the way for further losses for the EUR / CHF with an initial target at 1.0660. If the euro manages to stay above 1.0700, it could start to rebound.
The European energy crisis and the wave of global risk aversion propelled the Swiss franc which, along with the yen and the US dollar, are among the best performers on Wednesday. The European stock indices end in the red with losses of 1.25% on average, below the lows. Russian President Puttin’s comments on gas supply eased pressure on gas prices. An improvement in market sentiment could help EUR / CHF stay above 1.0700.
Commerzbank analysts have a negative outlook on EUR / CHF. “We see losses to the mid-October low at 1.0700 / 1.0689. Further down is the November low of 1.0629 and there is also a 78.6% retracement at 1.0643. We see that the pair will remain in that area. “