FXstreet.com (San Francisco) - EUR/USD has retraced the ECB-inspired rally above the 1.31 mark and, according to Carolin Hecht, economist at Commerzbank, the implied 1-year volatility in the pair is rising, which has led to the adjustment of the bank’s outlook for EUR/USD.
“As a result, the euro zone crisis remains a negative factor for the euro,” explains Ms. Hecht. “We have nonetheless adjusted our EUR/USD outlook slightly upwards as the Fed’s announcement of an unlimited QE3 programme is weighing on the USD.”
Camilla Sutton, Chief Currency Strategist at Scotiabank has also updated her EUR/USD forecast. In the short-term, her outlook is neutral, as the 200-day (1.2825) holds as support, which is encouraging for bulls: “We have updated our to reflect this; increasing our target for Q412 to 1.26 and leaving our target for Q413 unchanged at 1.21,”she says in a research note.
“As a result, the euro zone crisis remains a negative factor for the euro,” explains Ms. Hecht. “We have nonetheless adjusted our EUR/USD outlook slightly upwards as the Fed’s announcement of an unlimited QE3 programme is weighing on the USD.”
Camilla Sutton, Chief Currency Strategist at Scotiabank has also updated her EUR/USD forecast. In the short-term, her outlook is neutral, as the 200-day (1.2825) holds as support, which is encouraging for bulls: “We have updated our to reflect this; increasing our target for Q412 to 1.26 and leaving our target for Q413 unchanged at 1.21,”she says in a research note.
