Karen Jones, Head of FICC Technical Analysis at Commerzbank, noted that bullish attempts continue to struggle above the 1.1200 handle.
“The Euro has failed at the 20 day ma and again sold off to the base of the channel at 1.1138. Rallies are struggling to overcome the 20 day ma at 1.1208 and we look for failure here. Below 1.1138 channel should be enough to trigger losses to the 1.1070/23.6% retracement of the move higher this year and then the 55 day ma at 1.0986”.
“Rallies are likely to find initial resistance offered by the 20 day ma at 1.1208/35 and remain capped by 1.1300”.
“Above 1.1300, the market has potential to reach the highs from mid 2016 circa 1.1429 and the two year resistance line at 1.1472, however we believe it will struggle here from a longer term perspective. We note the 78.6% retracement lies at 1.1343”.
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