Although EUR/USD is still vulnerable to a corrective bounce, the broader trend stays lower to 1.3104, then 1.3020/15, notes Credit Suisse.

"EURUSD’s current decline is becoming stretched and near-term momentum is diverging, leaving prices vulnerable to a corrective bounce. However, the broader trend stays lower and we would view any strength as corrective and maintain downside targets next at the September low at 1.3104, followed by 1.3020/15 – the 50% retracement, 78.6% retracement of the 2013/2014 uptrend and measured target from the top. While we would expect stronger support here, a direct break below can see scope for 1.2994," CS clarifies.

"Near-term resistance shows at 1.3220, through which should see a small base for a move back to 1.3261. Above 1.3298 is needed to ease to mark a more concerted correction," CS adds.

In line with this view, CS maintains a short EUR/USD targeting 1.3025, with a stop at 1.3298.

EURUSD

In AUD/USD, CS notes that it has surged higher, taking out the mid-August high and 55-day average at .9346/63.

"The turns the focus on key price resistance at .9375. Above here though is needed to complete a base and signal further strength towards .9418 initially, ahead of the more important trendline resistance at .9447. A direct extension beyond the latter should trigger a move higher towards .9472 and then the 2014 high at .9506," CS projects.

"Support shows at .9329/28 at first, below which can see a move back to .9302/01. A break below here can see a move lower towards the recent low at .9242/30. Strategy: Flat. Buy at .9340, stop below .9301, for .9445," CS adds.

CS runs a limit order to buy AUD/USD at 0.9340, targeting 0.9445, with a stop at 0.9301.

EURUSD

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