USD strength is set to broaden out. Economists at Credit Suisse expect the EUR/USD pair to move downward to 1.1019/02 and potentially beyond.

The EUR Effective Exchange Rate (ECB) can weaken further in its own right to test its 2020 low at 94.88

“We maintain our view for further EUR/USD weakness yet with our core objective remaining at 1.1019/02, the 78.6% Fibonacci retracement of the 2020/2021 bull trend and the ‘neckline’ to the base from April/May 2020 and now also the long-term uptrend from 2000. We continue to look for this to ideally hold for what we think could be a lengthy sideways ranging phase.” 

The EUR Effective Exchange Rate (ECB) is currently consolidating at key support at the 38.2% retracement of the entire 2015/2020 bull trend but if this were to be conclusively removed this would suggest the EUR can weaken further in its own right to test its 2020 low at 94.88, a decline of 2.3% from current levels. This on its own would be sufficient to see EUR/USD down at 1.1019/02 but if the USD continues to strengthen in tandem this would suggest the broader risk would be for a move below 1.1000 post a consolidation phase, and a fall to potential trend support at 1.0800.”