19 Dec 2014
EUR/USD looks vulnerable, may shift lower – TDS
FXStreet (Barcelona) - Shaun Osborne and Martin Schwerdtfeger, FX Strategists at TD Securities, note that yesterday’s USD gains against EUR and JPY made the dollar look stronger, which leaves EUR/USD vulnerable to a shift lower, expecting a break below 1.2250 to lead towards 1.2025 through late January.
Key Quotes
“Equities rallied, US Treasuries went offered even as crude oil suffered another setback yesterday to close around $54.80. The sharp rally in US equities (the DJIA is up more than 4% in the past two days) will prompt suggestions of a “Santa Clause rally” which may underpin risk sentiment somewhat in the near-term after this week’s wobbles.”
“The rebound in risk has certainly doused any thoughts of USDJPY peeling back more of its recent gains as risk sentiment soured earlier in the week.”
“Today will most likely be a quiet day across G10 FX, with very little in the way of data in the US and the markets slowing down to their basal metabolic rate ahead of the holiday break.”
“Interestingly, yesterday’s gains against the EUR and the JPY left the USD looking strong on the charts. EURUSD, in particular, looks vulnerable to a shift lower with resistance around 1.2575 capping the EUR’s rebounds over the past month and price just a fraction off of the early December low. A break below 1.2250 will signal technical scope for a drop to 1.2025 through late January.”
Key Quotes
“Equities rallied, US Treasuries went offered even as crude oil suffered another setback yesterday to close around $54.80. The sharp rally in US equities (the DJIA is up more than 4% in the past two days) will prompt suggestions of a “Santa Clause rally” which may underpin risk sentiment somewhat in the near-term after this week’s wobbles.”
“The rebound in risk has certainly doused any thoughts of USDJPY peeling back more of its recent gains as risk sentiment soured earlier in the week.”
“Today will most likely be a quiet day across G10 FX, with very little in the way of data in the US and the markets slowing down to their basal metabolic rate ahead of the holiday break.”
“Interestingly, yesterday’s gains against the EUR and the JPY left the USD looking strong on the charts. EURUSD, in particular, looks vulnerable to a shift lower with resistance around 1.2575 capping the EUR’s rebounds over the past month and price just a fraction off of the early December low. A break below 1.2250 will signal technical scope for a drop to 1.2025 through late January.”