EUR/CHF 1H Chart: Triangle

Source: Dukascopy Bank SA
© Dukascopy Bank SA
Following a dip portended by a double top pattern, EUR/CHF entered a consolidation phase, which later on developed into a symmetrical triangle. Given that the currency pair has almost reached the apex of the figure, there is a high probability of a break-out and the ensuing elevated volatility. Since the market was bearish before the pattern, a sell-off through the up-trend at 1.2137 is considered to be more likely than a rally to the 200-hour SMA. Therefore a test of the Aug 11 and an eventual decline to 1.2121 is the base case scenario. On the other hand, the SWFX traders are optimistic regarding the Euro's prospects—71% of them are currently holding long positions.
© Dukascopy Bank SA
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