EUR/USD has rallied strongly higher to test the 55 day ma at 1.3699, notes Commerzbank.
“We note the 13 count on the 240 minute char t and the TD resistance at 1.3741. We also note the Elliott wave count is suggesting this short term rally higher is nothing more than a correction – we should there fore see this market fail circa 1.3700-45,” CB adds.
“Failure here will see attention revert to the 1.3503 recent low and the 1 .3482 2012 -2014 uptrend. This remains a key break down point to 1.2 750. Above 1.3745 will see a slightly deeper retracement to 1.3807 (61.8% retracement)” CB argues.
“We will attempt to trade from the short side while below here. Our longer term view remains bearish,” CB advises.
In line with this view, CB widens the stops on its EUR/USD short (entered at 1.3660) from 1.3710 to 1.3745. CB also adds another short EUR/USD position at market placing the same stop and target.
