EUR/USD fading downside momentum – Commerzbank
Downside momentum around the pair could be running out of steam, according to Karen Jones, Head of FICC Technical Analysis at Commerzbank.
“EUR/USD again has sold off however the new low has not been confirmed by the daily RSI and there is a TD perfected set up on the daily – both suggest a loss of downside momentum. Ideally rebounds will struggle to regain 1.1660/90. We remain bearish while capped here”.
“The market has recently completed a head and shoulders top pattern and a bear flag pattern – this is very negative price action. The measurement down from the head and shoulders top pattern 1.2092- 1.1662, is 1.1232. Given the close proximity of the 200 day ma at 1.1280 we will make this our downside target”.
“The outlook remains negative while capped by the current October highs and early August high at 1.1858/1.1910. Additional support is offered by the mid-June high at 1.1296 and the more important 1.1110 end of May low”.