The following are the latest technical setups for EUR/USD and GBP/USD as provided by the technical strategy team at Commerzbank.
EUR/USD’s daily RSI has now turned higher and the market after repeatedly testing the 1.3333/38 supports has lost downside momentum.
The near-term risk is for a corrective rebound near term towards the 3 month downtrend at 1.3459. A close below 1.3338 (base of the cloud on the monthly chart) is needed to trigger further losses to the 1.3295 November 2013 low en route to 1.3020/00, the 50% retracement of the move up from the 1.2042/July 2012 low.
A close above 1.3459 would delay our immediate negative outlook for a deeper retracement to 1.3550 and possibly 1.3680/1.3700, but while capped here a negative bias remain intact.
CB maintains a short EUR/USD poistion from 1.3425 targeting 1.3340.
GBP/USD has tested and is so far holding the 200 day moving average at 1.6664.
The rebound from here is indicated to terminate at 1.6760/1.6825, i.e. the rebound should halt ahead of the 6 week downtrend and while capped here the market will remain directly offered.
The target below the 1.6658 recent low is 1.6523 en route to 1.6280/53 the 38.2% retracement of the move from 2013 to 2014 and the 2014 low. Longer term we eventually look for losses back to 1.60.
CB runs a limit order to sell GBP/USD at 1.6770 with a stop at 1.6890.
