EUR: Decent momentum may fade – ING
|EUR/USD bullishness has continued to rise both in spot and via the options markets, with 1-month 25 delta risk reversals (cost of a call minus cost of a put) having moved from -0.2 to +0.3 in the past 10 days. There is still some room before reaching the September 0.7 or April’s 1.3 peaks, but the shift is clear, ING's FX analyst Francesco Pesole notes.
Return below 1.160 is quite possible
"The EUR/USD move has been primarily, but not entirely, driven by the dollar. European currencies are generally in demand, and while NOK, SEK and CHF have been the preferred currencies, the rest of the G10 has underperformed the euro since the start of the week."
"EUR/USD has now entirely erased its undervaluation gap, and we now feel less confident about short-term upside unless US data come in soft. We see some correction risks today, with a return below 1.160 surely possible."
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.