EUR/USD: Soft tone within bullish trend – Scotiabank
|Scotiabank analysts Shaun Osborne and Eric Theoret note the Euro is slightly weaker versus the Dollar, drifting toward the lower end of its recent range. Yield spreads remain supportive and the broader EUR/USD trend is still seen as bullish. However, analysts stay cautious below 1.20 and look for a near-term 1.1800–1.1900 trading range ahead of key PMI releases.
Euro eases as ZEW disappoints
"Germany’s ZEW sentiment figures were softer than expected, offering a disappointing outlook for industrial production in Germany (ZEW historically leads industrial production by about 12-18 months)."
"Interest rate differentials remain supportive however, with yield spreads pulling back up toward their recent multi-year highs."
"In terms of drivers, the EUR’s tight correlation to its 3M risk reversal suggests that sentiment remains dominant."
"The broader trend is bullish however we remain cautious below 1.20. We look to a near-term range of 1.1800/1.1900."
"The data calendar remains critical into Friday’s preliminary PMIs, with a heavy speaking schedule for the ECB.
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)
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.