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Karen Jones, analyst at Commerzbank, explains that the EUR/USD pair is correcting higher near term following the recent sell off to the 61.8% Fibonacci retracement of the 2017-18 advance at 1.1186, which has held the initial test.

Key Quotes

“The bounce higher has started to erode the 20 day ma at 1.1318 and this has neutralised the chart somewhat although intraday Elliott wave counts remain negative.”

“There is now a considerable amount of resistance above the market extending up to the 200 day ma at 1.1489. Rallies will find initial resistance at 1.1367/71 the 55 and 100 day ma, which guard the 1.1420 end of February high and the 1.1428 downtrend. Below 1.1185/75 lies the 1.1110, the May 2017 low and the 1.0814/78.6% retracement.”