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Analyst Karen Jones at Commerzbank, explains that the EUR/USD had an outside day to the upside last week, which suggests a reluctance to break down presently as any attempt to make gains are quickly defeated and currently the market is side lined.

Key Quotes

“The market needs to overcome the current November high at 1.1500 to alleviate immediate downside pressure and allows for gains to 1.1555/1.1622 (2018 downtrend and 16th October high). Dips lower will ideally be contained by the 1.1262 level – this guards the 1.1216 November low.”

“Below the 1.1216 current November low lies the 61.8% Fibonacci retracement of the 2017-18 advance at 1.1186. Failure there would put the late May and June 2017 lows at 1.1119/10 on the cards.”

Long term trend (1-3 months): A rise above the recent high at 1.1625 would confirm a trend reversal and put the 55 week moving average at 1.1852 back on the cards.”