EUR/USD has so far defended the 100-Day Moving Average and low of January near 1.0520/1.0480 resulting in an initial bounce. Economists at Société Générale note that reclaiming 1.0800 would negate Head and Shoulders pattern.

Break below 1.0520/1.0480 to trigger an extended down move

“It is worth noting that the pair is evolving within a possible Head and Shoulders; the pattern towards downside should a breakdown below neckline materialize. Recent pivot high near 1.0800 is a short-term resistance, this must be reclaimed to negate the formation.”

“If the pair breaks the neckline at 1.0520/1.0480, an extended down move is not ruled out. Next objectives would be at 1.0330 and September 2022 peak of 1.0220/1.0200.”