EUR/USD: banks’ opinion about correction
By Mark Jensen
EUR/USD found some support at $1.2815 and pushed up to $1.2880. Analysts point out that the pair’s having a small correction.
Commerzbank says that the pair remains dominated near term by its downtrend at $1.2914. The specialists point out that daily RSI has diverged quite significantly on the move to a new low and the pair can make a small corrective rebound.
Credit Suisse has placed a limit buy order today at $1.2800 with take profit at $1.2990 and stop loss at $1.2755. The specialists point out that a recovery above $1.2930 will bring EUR/USD to $1.2994 (Sep. 16 high). SEB Bank shares this view.
Still, pay in mind that counter trend trading (in this case buying) is riskier than trend following. The underlying bearish trend remains strong and most banks which share information about their positions are in shorts (Morgan Stanley, Danske, BNP Paribas, Citi and others). Credit Suisse has a sell limit on EUR/USD at $1.3110 targeting $1.2790.