EUR/USD points to some consolidation before targeting 1.2624 – Commerzbank

EUR/USD is holding above 1.2250 but Axel Rudolph, Senior FICC Technical Analyst at Commerzbank, spots a negative divergence on the daily RSI which warrants caution. Nonetheless, the pair still targets 1.2624, the 200-month moving average, in the long-term. 

Key quotes

“On a medium-term view, EUR/USD continues to track higher whilst targeting the 1.2556 2018 high and 1.2624, the 200-month moving average, which remains our longer term target. Short-term, the currency pair may form a minor top first, though, since negative divergence can be spotted on the daily RSI.” 

“The EUR/USD pair remains bullish while it trades above the 1.2210 late December low. Only failure there would put the early December high at 1.2177 back on the cards. Further minor support below the next lower 1.2130 December 21 low should find initial support at 1.2058, the December 9 low. Still further support can be spotted at the 1.2014 September peak.”