EUR/CHF Price Analysis: Trades above the 2020 descending trendline

• EUR/CHF has crossed above the 2020 descending trendline. 
• The breakout is backed by upward moving averages and other technical indicators.

EUR/CHF has breached the resistance of the trendline falling from Dec. 12 and March 26 highs and could revisit Tuesday's high above 1.06. 

The trendline resistance is located at 1.0544 and the pair is trading at 1.0552 at press time. The breakout was first confirmed by Monday's candle, however, the follow-through was weak, as the pair created an inverted bearish hammer on Tuesday. 

So far, however, the follow-through to Tuesday's bearish candle has remained elusive. In fact, the pair has bounced up from the  5-day average at 1.0540, reinforcing the immediate bullish bias signaled that ascending average. The 10-day average is also trending north and the 14-day relative strength index is looking to cross into the bullish territory above 50.

The bullish case would strengthen if the spot ends Wednesday above 1.0611 (Tuesday's high). Alternatively, acceptance under Tuesday's low of 1.0545 would validate the bearish inverted hammer and open the doors to 1.05.

Daily chart

Trend: Bullish

Technical levels