EUR/USD upside corrective near term – Commerzbank

Karen Jones, Head of FICC Technical Analysis at Commerzbank, noted the pair remains on an upside corrective fashion, with a potential test of the 1.0700 area according to technicals.

Key Quotes

“EUR/USD is upside corrective near term following its unsustained break to a marginal new low. The RSI has diverged, which points to a loss of downside momentum and the market has seen a recovery towards the 1.0619 resistance line. The intraday Elliott wave counts are implying a move to the 1.0700 recent spike high and the 38.2% retracement at 1.0707, where we suspect that the move will fail”.

“Failure here would cast attention back to the 1.0372/40 recent lows. We await a close below the 1.0372/66 lows from mid December 2016 to trigger another leg lower. Below 1.0340 will target parity and the 78.6% retracement at .9900 of the move 2000 to 2008”.