EUR/USD scope for further weakness – Commerzbank

In light of the recent price action, the pair could grind lower with targets around 1.0520 and 1.0460, suggested Karen Jones, Head of FICC Technical Analysis at Commerzbank.

Key Quotes

“EUR/USD has eroded its 32 year uptrend and reached the 2015-2016 uptrend at 1.0600, this will need to be broken on a closing basis to confirm the move lower. However the move to a new low has been accompanied by a TD perfected set up on the daily and there are 13 counts on the intraday charts and we would allow this to hold the initial test. Below 1.0582 lies the 1.0523 December 2015 low and the 1.0457 March 2015 low”.

“Initial resistance is the 1.0821 March low and the 1.0851 October low and the intraday Elliot wave count points to a 1.0775/1.0875 possible rebound”.

“Only above here would alleviate extreme downside pressure for a retest of the 1.1123/25 August and September lows, but even this would not negate our negative bias”.