EUR/USD was carried away to the downside by the pound after the UK elections. Where will it go next? The team at SocGen sets targets and notices an interesting pattern:
Here is their view, courtesy of eFXnews:
Societe Generale FX Technical Strategy notes an inverted head-and-shoulders pattern on EUR/USD weekly charts.
Such a pattern, according to SocGen, has taken shape at the down slanting channel support at 1.0350.
“The pattern’s validation level stands at 1.0860/1.08, which also coincides with multiyear graphical levels.
Thus, EUR/USD looks poised to head higher initially towards the down channel’s upper band at 1.1460, also the 2015/2016 highs (closing basis) and the 23.6% retracement of the down move since the 2011 peak.
It is then set to move towards 1.1685/1.1714, the August 2015 high and the 23.6% retracement of the entire down cycle.
Graphical levels at 1.1875/1.2043 will represent a key hurdle ahead,” SocGen argues.
EUR/USD is trading circa 1.12 as of writing.
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