EUR/USD: Scope for a deeper recovery to the 1.1949 mark – Credit Suisse

EUR/USD leaves behind two consecutive daily pullbacks and advances to the 1.1880/85 band on Tuesday. The pair is expected to extend its recovery to 1.1949, the 38.2% retracement of the May/July fall, the Credit Suisse analyst team reports.

Support is seen at 1.1850/40

“Resistance is seen initially at 1.1896/97, ahead of the 1.1910 high of last week and then our corrective objective of the 38.2% retracement of the fall from May and price resistance at 1.1945/49. Our bias would then be for this to prove a tougher cap and for the risk to turn back lower from here.” 

“Should strength instead extend this can allow the recovery to extend further yet with resistance seen next at the late June high at 1.1976, just ahead of the 55-day average at 1.1985, with a fresh cap expected here.” 

“Support at 1.1850/40 needs to hold to keep the immediate risk higher. Below can ease the immediate upward bias for a move back to 1.1799, then 1.1773/63.” 

“Below 1.1754/52 is needed to see bearish momentum return again for a test of medium-term support at 1.1703/1.1695.”