According to Karen Jones, Head of FICC Technical Analysis at Commerzbank, spot faces the probability of a correction lower in the near term.
“EUR/USD has reached long term Fibonacci resistance at 1.2517/1.2600. We note that the daily and weekly RSI are diverging and the steep January support line has also been eroded but the break was not sustained. The risk of a near term correction lower remains however. Below 1.2335 lies the January 18 low at 1.2165 and, more importantly, the August and September highs at 1.2092/70”.
“Above 1.2600 will test the 2008-2018 resistance line at 1.2710”.
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