EUR / USD has recovered strongly after holding as expected the 38.2% retracement of its November / January rally and the 55-day average at 1.2065 / 54, Credit Suisse analysts explain. They warn that a recent break above 1.2223 / 31 would confirm that the downward correction ended.
Key statements:
“The EUR / USD has recovered as expected after falling to test and stay above our first downside target of 1.2067 / 54, the December low, the 38.2% retracement of the November / January rally and a 55-day average bullish. However, the strength has been limited to the 13-day average, currently at 1.2167 and with a small ‘shoulder-head-shoulders’ top still in place, the risk of further corrective weakness remains before it resumes. the broader uptrend. “
“Support initially moves to 1.2102 / 00, then 1.2085. Below 1.2054 on a closing basis, support below can be seen at the September high at 1.2011 ahead of the 23.6% retracement of the entire 2020/2021 uptrend at 1.1945, with the “maximum target measured” at 1.1924 / 14. Then we would ideally look for an attempt to establish a major new floor here. “
“Above 1.2167 you can see that by force extending to 1.2179 / 80, and then to 1.2223 / 31, but a break here is necessary to negate the top, suggesting that the corrective pullback is coming to an end to return to the 1.2350 / 55 highs.“
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