The EUR/CHF price has been in a consolidation phase in the past few days as the market reflects on the recent interest rate decision by the European Central Bank (ECB). The pair is trading at 0.9863, which is slightly above this year’s low of 0.9812. The Swiss franc has risen by 6.15% since June.
The EUR to CHF exchange rate dropped below the parity level after the recent interest rate decision by the Swiss National Bank (SNB). The bank caught many analysts and investors off guard as the bank decided to hike interest rates by a whopping 0.50%. The governor also hinted that the bank would continue hiking interest rates in the coming months.
The ECB also decided to hike interest rates last week. Still, there are concerns about the health of the European economy. For example, data published on Monday revealed that business sentiment in Germany declined to the lowest level since the pandemic started. At the same time, Gazprom, the giant Russian oil and gas company, decided to reduce its gas supplies to Europe to just 20%. Analysts and government policymakers believe that Russia will slash gas supplies to zero as the region nears the winter season.
The four-hour chart shows that the EUR to CHF price has been moving sideways in the past few days. As a result, the pair remains between the 0% and the 23.6% Fibonacci retracement level. It is also oscillating near the 25-period and 50-period moving averages while the Relative Strength Index (RSI) has moved to the neutral point.
Therefore, the outlook for the pair is still bearish, with the next key target being at the year-to-date low of 0.9812. However, a move above the resistance at 0.9950 will invalidate the bearish view.