EUR/USD: TEMPORARY BREATHER BEFORE A FALL TO KEY SUPPORTS AT 1.0557/1.0501 – CREDIT SUISSE

EUR/USD stays seen on course to test a cluster of key supports at 1.0557/1.0501, in the view of analysts at Credit Suisse.

Looking for a fall to a cluster of key supports at 1.0557/1.0501

The decline in the EUR/USD has paused near term but we view this as a temporary breather.

We maintain our negative tactical and 3-6 month outlook for our target of the lower end of the channel, now at 1.0557. With further key supports seen just below here, firstly at the March low at 1.0524/16 and then the 200-DMA, now at 1.0512, our bias remains to look for a floor in this 1.0557/01 zone for now for a fresh and potentially lengthy consolidation phase.

Resistance at 1.0739/81 ideally caps on a closing basis to keep the immediate risk lower. Above can see a recovery back to 1.0832/34, potentially the 55-DMA, now at 1.0883, but with this expected to remain tough resistance.