21 Mar 2014
What lies ahead of the EUR/USD? – UBS and Commerzbank
FXStreet (Edinburgh) - The EUR/USD is now navigating the lower end of the Fed-induced pullback, hovering around 1.3770/80 ahead of EMU’s Consumer Confidence due this afternoon in Europe.
“The euro cannot rely on balance sheet divergence as a source of support for much longer either. Helped too by Fed tapering, balance sheet sizes are no longer diverging as quickly as they once did… The euro’s vulnerability to a Fed-inspired dollar advance is rising. Over time, further EURUSD downside beckons in our view – towards 1,25 by end-2014””, assessed strategists at the Swiss lender UBS.
In addition, Karen Jones, Head of FICC Technical Analysis at Commerzbank, commented, “We target initially 1.3643, the end of February low and eventually the 1.3476 2014 low and 1.3465 the 55 MONTH ma… Rallies are expected to hold below 1.3815/50 and only above here would suggest another run up to 1.3948/58”.
“The euro cannot rely on balance sheet divergence as a source of support for much longer either. Helped too by Fed tapering, balance sheet sizes are no longer diverging as quickly as they once did… The euro’s vulnerability to a Fed-inspired dollar advance is rising. Over time, further EURUSD downside beckons in our view – towards 1,25 by end-2014””, assessed strategists at the Swiss lender UBS.
In addition, Karen Jones, Head of FICC Technical Analysis at Commerzbank, commented, “We target initially 1.3643, the end of February low and eventually the 1.3476 2014 low and 1.3465 the 55 MONTH ma… Rallies are expected to hold below 1.3815/50 and only above here would suggest another run up to 1.3948/58”.