EUR/USD may see further short-term consolidation above the 2017 and YTD lows at 1.0350/41. Nonetheless, economists at Credit Suisse look for an eventual breakdown below here.

Strength to fade towards 1.0588/1.0615

“EUR/USD has now fallen to very key price support from the YTD and 2017 lows at 1.0350/41. Our bias is for further consolidation above here, over the coming days, prior to an eventual breakdown, which would trigger further weakness in our view, with support seen next at 1.0217/09 and eventually parity/0.99.” 

“Key short-term resistance moves to 1.0489, above which would confirm that the range bottom has held for now to reinforce our bias for further consolidation.” 

“Only a close above the 55-day average at 1.0588/0615 would raise the prospect of a lengthier consolidation phase and a deeper recovery and open the door to a test of the key 1.0774/88 May/June highs.”