EUR/USD is close to forming a base – Danske Bank

Research Team at Danske Bank expects that EUR/USD is close to forming a base as in their view, relative rates remain EUR/USD bearish as the Fed is slightly underpriced and the ECB is priced too hawkish.

Key Quotes

“However, it appears that clarity with regards to US tax reforms has been postponed towards later in the year and hence is less of a short-term USD positive. We believe that it is most likely that Le Pen will not become France’s next president. Hence, in our base case France’s election will not hinder a gradual rise in EUR/USD. Medium-term, we continue to expect EUR/USD to move higher on the large Eurozone-US current account differential and the undervaluation of the EUR. In sum, we are ‘rolling’ our EUR/USD forecasts predicting the cross at 1.06 in 1M(1.04previously), 1.08(1.05),1.10(1.08)and1.14(1.12).”

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 securities. 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 Forex 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.