EUR/CZK struggled to reclaim the upper band of a multi month descending channel near 25.80 resulting in a pullback. A deeper downmove would be on the cards if the pair breaks below the trough of November around 25.16, economists at Société Générale report.

Break above 25.32/25.35 is essential for a meaningful rebound

“EUR/CZK is now retesting the trough of November near 25.16. This is a crucial support. In case this breaks, there would be a risk of a deeper down move towards the lower limit of the channel at 25.00 with next support at 2020 low of 24.75.”

“A break above 25.32/25.35, the 23.6% retracement from November will be essential for a meaningful rebound.”