• EURCHF edges lower today after strong rally yesterday

• Significant sell-off recorded since end-September high

• Momentum indicators appear ready to turn bullish

EURCHF almost tested the all-time low at 0.9403 in an aggressive sell-off since the end-September high. This prompted a reaction from the bulls by recording two strong green daily candles. EURCHF is edging lower today as the bears are trying to find their footing especially as the momentum indicators do not appear to support their bearish intentions anymore.

In more detail, the Average Directional Movement Index (ADX) peaked on October 20, and it now appears to be heading aggressively lower, signaling that the short-term bearish trend has probably run its course. Interestingly, the RSI remains a tad below its 50-midpoint, revealing the presence of bearish pressure. However, the stochastic oscillator looks ready to give a strong bullish signal as it prepares to jump above its moving average and exit its oversold territory.

Should the bears remain committed to making lower lows, they would try to stage a move towards the September 26, 2022 low at 0.9403. If they are successful in overcoming this level, they will have the chance to record a new all-time low.

On the flip side, the bulls are keen on pushing EURCHF higher, even if this comes in baby steps. The next resistance area comes at the 0.9552-0.9571 range, defined by the August 23, 2022 low and the 50-day simple moving average (SMA). Even higher, the bulls could target the very busy 0.9626-0.9650 range, but they first have to overcome the important June 9, 2022 downward sloping trendline.

To sum up, the bears continue to hold most of the cards but a new move towards the all-time low of 0.9403 needs much more than stronger support from the momentum indicators.