26 May 2015
EUR/USD in 1.02 in 6-month – Danske Bank
FXStreet (Edinburgh) - Sverre Holbek, Senior Analyst at Danske Bank, sees the pair visiting the 1.02 area in a 6-month view.
Key Quotes
“EUR/USD continues to trade on a heavy note following the sharp decline on Friday when EUR/USD broke the key technical support level of 1.1050, which has been a level that opens up downside in the cross”.
“Currently, there are two main factors weighing on the cross. First of all, both Fed’s chairman Janet Yellen on Friday and Vice Chairman Stanley Fischer yesterday indicated that the first Fed hike is moving closer and although timing depends on data, this theme will continue to develop in the coming months”.
“Hence, the case for another leg lower in EUR/USD driven by relative rates remains intact despite recent weakness in US data”.
“Moreover, the negotiations between Greece and its creditors are heating up as the Greek government soon could run out of money. Hence, concerns about a possible accidental Greek default are likely to increase the risk premium on the EUR”.
“Fundamentally, we still look for EUR/USD to head lower in the coming 3-6M targeting the cross at 1.02 in 6M”.
Key Quotes
“EUR/USD continues to trade on a heavy note following the sharp decline on Friday when EUR/USD broke the key technical support level of 1.1050, which has been a level that opens up downside in the cross”.
“Currently, there are two main factors weighing on the cross. First of all, both Fed’s chairman Janet Yellen on Friday and Vice Chairman Stanley Fischer yesterday indicated that the first Fed hike is moving closer and although timing depends on data, this theme will continue to develop in the coming months”.
“Hence, the case for another leg lower in EUR/USD driven by relative rates remains intact despite recent weakness in US data”.
“Moreover, the negotiations between Greece and its creditors are heating up as the Greek government soon could run out of money. Hence, concerns about a possible accidental Greek default are likely to increase the risk premium on the EUR”.
“Fundamentally, we still look for EUR/USD to head lower in the coming 3-6M targeting the cross at 1.02 in 6M”.