EUR/USD exposed to two clear downside risks in near-term – Societe Generale
|The analysts at Societe Generale offer their outlook on the EUR/USD pair, in the wake of the recent weakness in the pound and the Chinese Yuan.
Key Quotes:
“Over 6-12 month horizon, given positions and valuation, it's easier to see EUR/USD at 1.20 than 1.05.
But, in the one to the three-month horizon: There are two clear downside risks.
A weaker Yuan … A near-term break of USD/CNY 7 may be unlikely, but it would drag EUR/USD through the year's lows and could trigger stops.
And a weaker pound … If sterling takes another significant knock that too will hurt the Euro.
It’s difficult to gauge the probability of the Chinese authorities allowing USD/CNY to break higher, or of another sterling confidence crisis.”
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.