EUR/USD has extended its setback. However, this phase should prove to be temporary, in the view of analysts at Credit Suisse.

Key level to watch is 1.0655 in EUR/USD

“Near-term momentum stays lower, and below 1.0695/55 would be seen to warn of a deeper but still, we think corrective setback to next support at the 38.2% retracement of the 2022/2023 rally and early January YTD low at 1.0483/63. We look for this though to prove better support if tested.”

“Above 1.0802/06 is needed to clear the way for strength back to test the 50% retracement of the 2021/2022 fall at 1.0944. A weekly close above here should see a move back to the 1.1035 current YTD high and eventually what we look to be tougher resistance at 1.1185/1.1275.”