ECB inaction and strong Retail Sales could send EUR/USD back through 1.07 – SocGen

FXStreet Insights Team FXStreet

Kit Juckes, Chief Global FX Strategist at Société Générale, analyzes EUR/USD outlook ahead of the ECB meeting and US Retail Sales.

Short Cable for the ECB?

A 25 bps ECB hike and a clear indication of a pause would risk leaving the Euro in a range, especially if US Retail Sales aren’t strong.

ECB inaction and strong Retail Sales could send EUR/USD back through 1.07 and reverse some of the drop in US yields from Wednesday, giving the Dollar a more pronounced bounce.

Short GBP/USD would appeal even more and if 1.2430 broke, a decent fall could follow. Even someone as untechnical as me can see the significance of the 200-DMA here.

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