EUR: Drops below 1.1500 unsustainable for now – ING
|Our EUR/USD model returns a short-term undervaluation of 2%, ING's FX analyst Francesco Pesole notes.
EUR/USD may struggle to trade sustainably above 1.160-1.1650
"That means that the drop in the pair has materially exceeded what the changes in the rate differential and other market drivers can justify. That, along with what was discussed in the USD section above, means that the balance of risks is still tilted to the upside in the near term."
"We think EUR/USD can make brief explorations below 1.150, but for those to be sustainable, we'd need either a broader hawkish re-rating (due to strong US data) or some negative news affecting the euro."
"Our year-end 1.18 target remains unchanged anyway, even though the pair may struggle to trade sustainably above 1.160-1.1650 until mid-December."
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.