EUR/USD to suffer a deeper dip on a break below the 1.2070/52 support zone – Commerzbank

EUR/USD is slipping back towards minor support at 1.2070/52. A break below this neighborhood would trigger a sharper fall towards the 1.1994/86 support area, Axel Rudolph, Senior FICC Technical Analyst at Commerzbank, reports.

Channel support line at 1.2070 offers support

“EUR/USD continues to trade within its recent downtrend channel and nears the channel support line and the 55-day moving average at 1.2070/65 which may offer short-term support.” 

“A fall through the next lower 1.2052 mid-May low on a daily chart closing basis would probably trigger a deeper retracement to the 1.1994/86 band of support (mid-March highs and April 22 as well as May lows) which should ideally hold the downside.” 

“Only a currently unexpected bullish reversal above last week’s high at 1.2218 would re-engage the 1.2266 end of May high which guards the 1.2349 January high.”