EUR/USD: Societe Generale bank sees the cross falling down to 1.04/1.05

"We are at a critical level for those who are anticipating a corrective pull back on the EUR/USD, says SocGen.

"Given the highly negative EUR/USD close last week, the EUR/USD will form an "Evening Star", a technical configuration which suggests further losses. An evening star coupled with August's shooting star suggests a bearish scenario.

The current pull back within the wide bearish flag resembles that of 1998-1999, when a shooting star ended the rebound. "

SocGen thinks that the current break below 1.1085 means that we will re-test the multi-decennial support at 1.05/1.04 with intermittent objective of 1.0940 or even 1.08.

"A movement below 1.05/1.04 would mean that we would be retracing the entire upward move dating from 1980 and not just since the 2000s" adds the SocGen bank.