EUR/USD: Key support starts at 1.1725 and stretches down to 1.1697 – Credit Suisse

FXStreet reports that EUR/USD has seen a fresh and sharp fall for the completion of a bearish “outside day” and with the momentum picture already poor this sees the threat of a top quickly return, with key support seen starting at 1.1725 and stretching down to 1.1697, per Credit Suisse.

“The brief hold above the 13-day exponential average did not last long on Friday and the subsequent sharp fall has seen this removed for the completion of a bearish ‘outside day’, and this is seen significantly raising the prospect we are looking at a near-term topping process, especially given the poor existing momentum picture.” 

“Resistance at 1.1819 capping can keep the immediate risk lower with the ‘neckline’ to the top seen at 1.1725 today, with key price support then seen at 1.1710 and then more importantly at the 1.1697 August low. Only below this latter level though would see a top confirmed to mark a more important turn lower with support then seen next at 1.1661/52 – the 23.6% retracement of the entire rally from March and 38.2% retracement of the rally from late June – which we would expect to hold at first. A break in due course though can see the uptrend from May next at 1.1618, with the ‘measured top objective’ though would be seen set lower at 1.1476.” 

“Above 1.1819 can see a recovery back to 1.1847, but with a break above 1.1883 needed to neutralise Friday’s bearish session, with resistance then seen next at 1.1949/53.”