According to Karen Jones, Head of FICC Technical Analysis at Commerzbank, the pair is still expected to retest the 1.1745/50 band.
Key Quotes
“EUR/USD consolidated yesterday following its recent break above the 55 day ma. This is constructive and there is scope for recovery. Nearby resistance is offered by the 1.1745/50 area, then the 1.1790 recent high. These should offer a tough near term barrier. A recovery above here will trigger a move to the 1.1853 mid-June high and the 1.1922 55 week ma. We suspect that the recent low at 1.1301 was a significant turn for the market. Initial support lies at the 1.1616 55 day ma and the 1.1538 20 day ma. The cross will need to drop sub 1.1508 to alleviate immediate upside pressure. Currently near term dips lower are indicated to hold around 1.1625/1.1580″.
“A drop below the 1.1508 June low would retarget the current August low at 1.1301″.
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