EUR/USD fell to the lowest levels since December as the greenback pushed forward and Europe’s economic slowdown seems serious. What’s next? The team at Bank of America looks at the charts.
Here is their view, courtesy of eFXdata:
Bank of America Merrill Lynch Research discusses EUR/USD technical outlook and maintains the view that the pair has confirmed a triangle top on the daily chart, but flags a scope for a 6-days consolidation period before resuming its move lower.
“The triangle top targets the mid-1.18s and the expanded flat pattern underway implies a decline as deep as 1.1709 – 1.1676. The latter is not asking for much given it’s just a 38.2% retracement.
“EUR/USD has marked daily closes below a sea of support levels earmarking the bearish tone and decline. The 50d SMA may soon cross below the 100d SMA. After this cross, EUR/USD tends to consolidate for six trading days,†BofAML argues.
In line with this view, BofAML maintains a short EUR/USD* position targeting a move to 1.15.
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