EUR/USD advances for the second straight session after plunging to its lowest level in nearly twenty years at 0.9952 on Thursday. Analysts at Credit Suisse continue to look for a consolidation/recovery phase to emerge.

Parity/0.99 to hold

“With RSI momentum at oversold levels typically associated with a low, we continue to look for a floor at our long-held parity/0.99 objective and for a consolidation/recovery phase to emerge.” 

“Resistance for recovery is seen at 1.0134 initially, ahead of the recent reaction highs and 13-day exponential average at 1.0183/1.0205, with sellers expected to show here. Above this latter area though would suggest a deeper recovery can unfold, with resistance seen next at the 38.2% retracement of the May/July fall at 1.0271.” 

“Big picture though, our bias is to view a consolidation phase as temporary and we see no reason not to look for an eventual break below 0.99 in due course with support seen next at 0.9799/95.”