EUR/USD remains capped as expected below the 200-Day Moving Average on a closing basis, currently seen at 1.0409. Analysts at Credit Suisse see scope for a deeper setback to the 38.2% retracement of the rally from September at 1.0120.

Resistance at 1.0409 is expected to cap for now

“EUR/USD remains capped as expected by key resistance from its falling long-term 200DMA, currently seen at 1.0409, and with a minor top now seen in place, we continue to see scope for a deeper setback from here.” 

“Support is seen next at the rising 13DMA at 1.0211, a close below which would be seen to clear the way for a test of the October/November reaction highs at 1.0197/95. We continue to look for a floor here. Should weakness directly extend, this would raise the prospect of further weakness, with support then seen next at the 38.2% retracement of the September/November rally at 1.0120.”

“Resistance is seen at 1.0334 initially, with a close above the 200DMA at 1.0409 needed to clear the way for further strength back to the 1.0481 high and eventually the 38.2% retracement of the entire 2021-2022 fall at 1.0612/15.”