EUR/USD to warn of a near-term top below 1.2134/25 – Credit Suisse

EUR/USD rally continues to lose momentum and with the intraday base negated, economists at Credit Suisse look for a retest of key support at 1.2134/25 – removal of which would see a near-term top established.

Resistance stays seen at 1.2267

“With daily RSI momentum and daily MACD momentum now moving lower, the rally from late March continues to show signs of tiring and the immediate risk stays seen on balance lower.”

“Immediate support moves to 1.2163/59, below which can see a retest of the recent low and 23.6% retracement of the March/May uptrend at 1.2134/25. A break here can see a top complete to reinforce a broader sideways range and a fall to 1.2053/51 – the mid-May low and 38.2% retracement. Our bias remains to look for a better floor here.” 

“Resistance moves to 1.2218 initially, then 1.2234 and more importantly at the 1.2255/67 current cycle highs.”

“Beyond the 1.2255/67 area remains needed to ease threats of a setback and resolve the range higher for a challenge on the top of the range for the year at 1.2321/1.2350. We would then look for a fresh cap here for a swing lower within the broader converging range.”