EUR/USD: Rebound to struggle at 1.2140 – Commerzbank

EUR/USD has held initial test of the 55-day moving average at 1.2058 and the pair has recaptured the 1.2100 level. At press time, EUR/USD is edging higher, up 0.25% on the day, but intraday rebounds are indicated to struggle around 1.2140, per Commerzbank.

Key quotes

“EUR/USD has sold off to, tested and so far held the 55-day ma at 1.2058, intraday rebounds are indicated to struggle around 1.2140.”

“Beyond the the 55-day ma at 1.2058 we would allow for losses to extend to 1.2014 the September high and even the 1.1969 2020-2021 uptrend, which we suspect will hold the initial test.” 

“Assuming that the uptrend (1.1969) and 23.6% retracement of the move up since March 2020 (1.1945) holds; medium-term the market continues to track higher whilst targeting the 1.2556 2018 high and 1.2624, the 200-month moving average, which remains our longer-term target.” 

“Loss of 1.1945 will imply a deeper sell off to the 1.1615/02 support, this is the 38.2% retracement and the September and November lows.”