Karen Jones, Head of FICC Technical Analysis at Commerzbank, noted technicals suggest that the current rally in spot could struggle around 1.1625.
“EUR/USD continues to recover from just ahead of 1.1411, the 78.6% retracement. Note that the Elliot wave count is suggesting that the rally will fail circa 1.1625 – we will tighten up stops on our positions just in case. Only above 1.1625 will neutralise the chart again and allow for another run up to the 1.1790/1.1815 region. We continue to favour the topside but there is more work to be done”.
“The 1.1411 level is seen as the last defence for the 1.1325 200 week ma and the 1.1301 recent low”.
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