A small hammer candle Monday and modest bullish confirmation so far Tuesday that remains within the longer-term bear trend is probably just a corrective impulse.
Recent rhetoric suggests the Swiss National Bank will still intervene if necessary, despite its currency manipulator tag by the U.S. Treasury.
However, the steady decline in EUR/CHF hints at a market that values safety over central bank threats, for now.
While there have been upticks in EUR/CHF, the longer-term (near-two-year duration) bear trend is still very much alive.
Recent data have bolstered the franc's appeal with a robust Swiss KOF reading and a trade balance swelling to a record surplus in 2019 nL8N29Y5HQnL8N29X3DE.
The SNB might be less inclined to weaken the franc within this environment, which would only add to the positive CHF flow.
Against such a backdrop, this week's potential bullish adjustment is unlikely to travel far.
There's scope to 1.0750, 21-DMA, or even the 1.0788 failure high from Jan.
22, but the scope beyond that is limited.
EUR/CHF Daily Candle Chart: Click here