EUR trading turns a little choppy – Scotiabank
Spot trading is turning a little choppy on the day as the Euro (EUR) probes the 1.09 area but further EUR gains look likely as investors focus on the massive loosening in Eurozone fiscal policy and the jump in yields that resulted and contrast that with lower yields and growth concerns in the US that is chipping away at the 'US exceptionalism' narrative, Scotiabank's Chief FX Strategist Shaun Osborne notes.
EUR advance extends through 1.09
"European stocks continue to outperform US equities by a significant margin despite continued volatility across markets. In YTD terms, the performance split is massive—around 15% percentage points. Solid stock gains amid a massive loosening in European (German) fiscal policy suggest the outperformance may extend and extend the EUR a bit more of a lift."
"New highs for spot—the EUR is close to regaining the peak reached around the US election at 1.0935 back in November—keeps the technical trend positive and the focus on the topside for spot. The 1.0957 point is the key technical level to focus on in the near term—it’s the 76.4% Fib retracement of the 1.12/1.01 drop and the final, major resistance point ahead of return to 1.12. Support is 1.0725 and 1.0795/00."
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FXStreet Insights Team
FXStreet
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