EUR/USD scope for a test of 1.1800 – Commerzbank
According to Karen Jones, Head of FICC Technical Analysis at Commerzbank, the current recovery could take spot to test the 1.1800 area.
“EUR/USD is seeing a small corrective rebound very near term, the new low has not been confirmed by the daily RSI and there remains a TD perfected set up on the daily – both suggest a loss of downside momentum, current intraday Elliott counts are implying scope for a 1.1800 rebound. Initial resistance lies 1.1660/90. Beyond this rebound we remain negative. 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 is 1.1232. The 200 day ma lies at 1.1289 just ahead of here”.
“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”.