16 Dec 2014
EUR/USD might move towards 1.2735 levels – Scotiabank
FXStreet (Barcelona) - Camilla Sutton CFA, CMT, Chief FX Strategist at Scotiabank sees the EUR/USD pair trading higher due to EUR strength, further anticipating the pair to rally towards 1.2735 levels if it closes above the 50-day MA at 1.2537 levels.
Key Quotes
“EUR is strong, having rallied to a one month high and flirting with a break above the 50-day MA.”
“The rally played out throughout the European session as four themes joined together to support EUR: 1) stronger than expected European PMI, which suggest a slightly firmer end of year in both services and manufacturing; 2) ECB Weidmann’s comments that suggest there is still a lot of risk that the ECB will not turn to QE; 3) flows where the combination of risk aversion, which is seeing flows being shifted out of EM and more vulnerable commodity currencies and into JPY, CHF, EUR and GBP; and 4) a subtle shift in sentiment, which we highlighted yesterday, that is driving profit taking on short EUR positions.”
“A close above the 50-day MA at 1.2537 would open up a test to 1.2735 (congestion) and potentially even the 100-day MA at 1.2801; however even a retracement is likely to be temporary with the overarching theme still one of a bearish EUR that trends lower in 2015 and 2016.”
Key Quotes
“EUR is strong, having rallied to a one month high and flirting with a break above the 50-day MA.”
“The rally played out throughout the European session as four themes joined together to support EUR: 1) stronger than expected European PMI, which suggest a slightly firmer end of year in both services and manufacturing; 2) ECB Weidmann’s comments that suggest there is still a lot of risk that the ECB will not turn to QE; 3) flows where the combination of risk aversion, which is seeing flows being shifted out of EM and more vulnerable commodity currencies and into JPY, CHF, EUR and GBP; and 4) a subtle shift in sentiment, which we highlighted yesterday, that is driving profit taking on short EUR positions.”
“A close above the 50-day MA at 1.2537 would open up a test to 1.2735 (congestion) and potentially even the 100-day MA at 1.2801; however even a retracement is likely to be temporary with the overarching theme still one of a bearish EUR that trends lower in 2015 and 2016.”