EUR/CHF falls to 3-month lows amid recession fears

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  • The Swiss franc is one of the most important values ​​on Thursday.
  • Data from the Eurozone and the US raise concerns about growth prospects.
  • EUR/CHF is back close to parity with bearish pressure intact below 1.0150.

After moving laterally for four days, the EUR/CHF it broke lower falling to 1.0067, the lowest level since early March. The cross remains below 1.0100, poised to post the second lowest daily close since 2015.

A recovery above 1.0150 should ease downside pressure. To the downside, support levels could be seen at 1.0040, followed by the parity zone and then the February low at 0.9970.

Yields are down for the wrong reasons

Eurozone June PMIs surprised sharply to the downside in the services and manufacturing indices. In the region, the main manufacturing index stood at 52.0 against the market consensus of 53.8, while the services index fell from 54.8 to 51.9.

“June PMI data shows Europe teetering on the brink of recession. We now expect the Eurozone to enter a mild recession in 2022H2,” analysts at TD Securities wrote. They note that central banks, including the European Central Bank, are likely to continue with their plans for now, but expect their tone to become more cautious later in the year.

Expectations of a tightening of the European Central Bank have diminished after the negative economic reports. The German 10-year yield falls by more than 10% as it stands at 1.42% (on Monday it was at 1.80%). Even Italian yields are lower, with the 10-year at 3.48%, the lowest since June 9.

Technical levels

EUR/CHF

Panorama
Last Price Today 1.0109
Today’s Daily Change -0.0049
Today’s Daily Change % -0.48
Today’s Daily Opening 1.0158
Trends
20 Daily SMA 1.0311
50 Daily SMA 1,032
100 Daily SMA 1.0314
200 Daily SMA 1.0428
levels
Previous Daily High 1.0189
Previous Daily Minimum 1.0132
Previous Maximum Weekly 1.0479
Previous Weekly Minimum 1.0098
Monthly Prior Maximum 1.0516
Previous Monthly Minimum 1.0228
Daily Fibonacci 38.2% 1.0154
Daily Fibonacci 61.8% 1.0167
Daily Pivot Point S1 1,013
Daily Pivot Point S2 1.0103
Daily Pivot Point S3 1.0074
Daily Pivot Point R1 1.0187
Daily Pivot Point R2 1.0216
Daily Pivot Point R3 1.0243

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Source: Fx Street

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