Synopsis:

Societe Generale sees a technical setup for EUR/USD around critical levels, with potential support at 1.0740 and resistance near 1.0870. After confirming a double top around 1.1200, EUR/USD’s downtrend appears stretched, with MACD in negative territory suggesting a possible short-term bounce.

Key Points:

• EUR/USD has confirmed a double top near 1.1200, initiating a steady decline that has now reached its target.
• Immediate support lies at 1.0740, which aligns with a trend line from October 2023, representing a key level to watch.
• Daily MACD indicates a stretched decline, suggesting a potential bounce; the pair needs to clear the 200-DMA and 1.0870 resistance to regain upward momentum.
• If EUR/USD fails to hold above 1.0740, further downside may lead to support levels at 1.0665 (June low) and 1.0600.

Conclusion:

SocGen’s technical analysis highlights a critical juncture for EUR/USD. A break above 1.0870 could signal recovery potential, while a failure to hold 1.0740 might extend the correction, with next supports at 1.0665 and 1.0600.