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The EUR/USD pair is seen at risk to further consolidation/corrective weakness, but with the broader trend still seen higher for 1.2355 and eventually 1.2518/98, analysts at Credit Suisse report.

Key quotes

“EUR/USD remains capped at the top of the price gap from the beginning of this week at 1.2259 and with daily momentum turning lower, a lengthier consolidation/corrective phase is seen as likely. Our broader view remains unchanged though and we continue to view this as a temporary affair ahead of the core uptrend resuming in due course.” 

“For now, we continue to look for support at 1.2129/22 to try and hold for high-level consolidation, but with a break above 1.2259 needed to reassert an upward bias for strength back to the 1.2273 current high, ahead of the March “measured base objective” at 1.2355.” 

“Big picture, we continue to look for our core objective from late July at 1.2518/98, which we expect to prove a major barrier.” 

“Below 1.2122 would raise the prospect of a more concerted setback and a fall back to 1.2059, potentially what we expect to be better support at 1.2017/11 – the 38.2% retracement of the November/December rally and September.”