Credit Suisse discusses EUR/USD technical outlook and flags a scope for consolidation phase in the near-term.
Even though EURUSD managed to move briefly above 1.1900 on Friday strength was not sustained and the subsequent sharp retreat has seen the market close the week back below the long - term downtrend from the 2008 peak at 1.1797. This suggests the rally has become exhausted near term and although our core outlook stays bullish ( we now look for a consolidation/correction to emerge," CS notes.
"Below 1.1734/31 should see weakness extend back to the 13 -day average at 1.1655, potentially the 38.2% retracement at 1.1627/22, but with this latter support then ideally holding.
Post a pullback we would look for the uptrend to resume with resistance seen at 1.1797 initially and with 1.852/63 needing to be cleared for a direct move back to 1.1904/09. Above here in due course should see strength extend to our first major flagged resistance at 1.2145/55," CS adds.