EUR/USD managed to recover after Draghi didn’t offer anything really new. The ECB is ready to do more, but there seems to be a lack of urgency.
But this may be only a pause on the way down according to Credit Suisse:
Here is their view, courtesy of eFXnews:
EUR/USD has been trapped in a broad sideways range since March this year, notes Credit Suisse.
“However, with a multi-year top in place following the collapse below the 1.2043 low of 2012, we correspondingly view this as a pause before the core bear trend resumes,” CS argues.
CS thus continues to look for an eventual breakdown in EUR/USD below the May/July lows at 1.0819/09 to trigger a test of the March 2015 1.0458 trough low.
“We would again allow for an initial hold here. However, beneath it can see the medium-term trend turn lower again for our long standing core bear objective at 1.01/.99,” CS projects.
“Resistance shows first at 1.1460, above which would warn of strength back to 1.1714, and more likely the 38.2% retracement of the 2014/2015 collapse at 1.1808/11,” CS adds.
Short-term, CS looks for a retest of the 55-day average at 1.1122 and a clear eventual extension beneath to test the September low at 1.1087 next.
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