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Technical Correction May Pave the Way for the Next Upswing
Central Bank
Economic
Summary:
Given the strength of the prevailing primary uptrend, the current bearish move is viewed as a technical retracement rather than a trend reversal.
Buy
PENDINGEURCHF
EXP
0.93050
Entry Price
0.93500
TP
0.92800
SL
0.93133 +0.00042 +0.05%
--
Point
PENDING
0.92800
SL
CLOSING
0.93050
Entry Price
0.93500
TP
The Swiss National Bank (SNB) reiterated its decision to maintain the policy rate at 0% during its December meeting, citing broadly stable medium-term inflationary pressures. The central bank emphasized that its current monetary stance remains appropriate for anchoring inflation within the price stability range while providing necessary support to the domestic economy. Furthermore, the SNB reaffirmed its readiness to intervene in the foreign exchange market should conditions necessitate such action.
While inflation has dipped slightly in recent months, the SNB noted that the overall outlook has not shifted sufficiently to warrant a policy adjustment at this stage. Consumer price inflation decelerated to 0.0% in November; however, both short- and long-term inflation expectations remain well-anchored within the SNB's definition of price stability.
Domestically, the SNB highlighted a period of moderate economic momentum, as overall growth remained subdued through the third quarter. Despite this softening activity, the central bank observed tentative signs of improvement heading into the year-end, bolstered by a marginal recovery in the global context and diminishing trade-related uncertainties. Nevertheless, the SNB’s Quarterly Bulletin pointed toward a cooling labor market, with employment growth stagnating in Q3 and the seasonally adjusted unemployment rate rising to approximately 3.0% in November.
The European Central Bank (ECB) kept its key interest rates unchanged for the fourth consecutive meeting, holding the Deposit Facility at 2.00%, the Main Refinancing Operations rate at 2.15%, and the Marginal Lending Facility at 2.40%, in full alignment with market consensus.
In the accompanying policy statement, the ECB Governing Council reaffirmed its commitment to stabilizing inflation at the 2% medium-term target. Policymakers underscored a data-dependent, meeting-by-meeting strategy, noting that future rate paths will depend on incoming financial data and the underlying strength of price pressures. During the subsequent press conference, President Christine Lagarde clarified that neither rate hikes nor cuts were discussed, emphasizing that the bank cannot provide explicit forward guidance given the current climate of uncertainty. While describing the Eurozone as resilient, she cautioned that a challenging global trade environment is likely to dampen growth.
Technical Analysis
The EUR/CHF pair has recently retraced to the 0.9304 support level, a zone that saw a rapid bullish rejection in recent price action. This initial resilience provides early signals that the pair may be entering a corrective phase to the upside. Given the strength of the prevailing primary uptrend, the current bearish move is viewed as a technical retracement rather than a trend reversal. Should the support hold, the immediate objective for bulls sits at the 0.9350 resistance level.
From a technical perspective, the 100 and 200-period Moving Averages (MAs) on the 4-hour chart are positioned at 0.9302 and 0.9288, respectively. The price has successfully reclaimed the 200-period MA, which is expected to provide dynamic support for a bounce. Additionally, the Relative Strength Index (RSI) recently touched the 28 level, signaling oversold conditions.
This lower reading increases the probability of a bullish reversal from this cluster. However, traders should note that a decisive break and close below the 0.9304 support would invalidate this bullish setup and suggest a deeper correction.
Trading Recommendations
Trading direction: Buy
Entry price: 0.9305
Target price: 0.9350
Stop loss: 0.9280
Validity: Dec 30, 2025 15:00:00
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