EUR/USD is trading at the 1.16 handle. Has it stabilized in this region? Will it move up from these levels? Here are two opinions about the current state of affairs in the pair.
Here is their view, courtesy of eFXnews:
EUR/USD: Signs Of Stabilization; Above 1.15 Diminish Risk Of Deeper Pullback – BTMU
BTMU FX Strategy Research discusses EUR/USD outlook for this week, noticing that after adjusting modestly lower since the ECB’s last policy meeting, there are emerging tentative signs of stabilization.
“If EUR/USD continues to hold above key technical support at the 1.1500-level, the risk of a deeper euro pullback will diminish.
“The strengthening economic recovery in the euro-zone remains supportive for the euro and should help dampen downside risks. The release of the latest euro-zone GDP report for Q3 should confirm that robust growth has continued.
The market’s focus is more likely to be on developments in the US….The release of the latest US CPI and retail sales reports for October will be scrutinized closely as well to assess if the Fed’s plans for gradual tightening are still appropriate,” BTMU argues.
BTMU is neutral on EUR/USD around current levels, seeing the pair trading in 1.14-1.18 range in the near-term.
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EUR: Balanced Positioning; Staying Long EUR/USD, EUR/CHF – Credit Agricole
Credit Agricole CIB FX Strategy Research discusses the EUR outlook this week and maintaining a bullish bias on the single currency and staying long EUR/USD* and EUR/CHF*.
“We remain of the view that the EUR faces upside risks even though the ECB is unlikely to consider a less dovish policy stance anytime soon…It must be noted too that speculative EUR positioning is back in balanced territory. Such conditions lessens the risk of further currency downside and instead implies that the last few weeks’ downside was corrective rather than a change in trend,” CACIB argues.
Data-wise, CACIB notes that will be quiet in terms of top tier data releases.
“While the ZEW economic sentiment survey is unlikely to trigger any sustainable currency trends, there may still be some limited focus on the release of final October CPI and preliminary Q3 GDP,” CACIB adds.
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