Euro Gets Dollar Trend-Line Support, Commerzbank Says : Technical Analysis

The euro may pause a longer-term decline against the dollar in coming days after it fell to a key support level, Commerzbank AG said, citing technical indicators.

The uptrend line created from lows in June gave support at $1.2735 today and may lead to a “minor recovery towards the $1.30 region,” Axel Rudolph, a senior technical analyst at Commerzbank in London, wrote in a research report today. “Another down leg towards the $1.25 region and eventually the $1.20 mark should then be made over the coming months.”

The euro fell as low as $1.2734 today, before rising 0.5 percent to $1.2818 as of 1:14 p.m. in London.

In technical analysis, investors and analysts study charts of trading patterns to forecast changes in a security, commodity, currency or index. Support is where buy orders may be grouped, and resistance is a level where sell orders may be gathered.