GBPCHF fell to the lowest level in a month on Tuesday to reach 1.3598. The market has retraced almost all of the recent bounce from 1.3413 to 1.4611 (April to May rise).
After briefly breaching the 200-day moving average to peak at 1.4611 on May 26, prices fell back down. The fall below the 50-day and 50% Fibonacci at 1.4014 accelerated a decline and prices have now broken below the 78.6% Fibonacci level of 1.3672.
The daily RSI is bearish below 50 and is trending down, which suggests further downside risk. But as the RSI indicator is approaching oversold levels, there could be consolidation at current levels. Prices are now testing the round figure level at 1.3600. If there is a daily close below this key psychological level, prices could extend the decline to the April 7 low of 1.3413, which would see full retracement of the recent upleg.
The market would need to rise back above the 50-day moving average and the 50% Fibonacci at 1.4014 to shift this short term bearish bias. Alternatively a break below the 1.3413 low would see a resumption of the longer term downtrend that started from 1.5570 back in November.
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