Analysts at MUFG Bank, consider that the bullish momentum for the Euro may continue next week. They see the EUR/USD pair trading in the 1.0950/1.1250 range.
Key Quotes:
“Assuming EUR/USD doesn’t drop sharply from here before the close, the calendar month gain in October will be the largest since January 2018, highlighting the current positive momentum that has not been seen for some time. In many ways this is again the euro playing its role as the anti-dollar and for that reason alone is making these gains. The optimistic spin from Fed Chair Powell last night in his press conference doesn’t appear to have been believed by market participants and incoming economic data will remain the determinant of market pricing, not the Fed’s view that it can now pause its rate cutting cycle. The Chicago PMI today (43.2 in October from 47.1) today is the latest data that suggests economic weakness may have more to go before any benefits from de-escalating trade tensions have an impact.”
“Key of course for direction in the week ahead will be tomorrow’s US payrolls report and the MUFG call of about 90k would again point to evidence of slowing jobs growth that in turn points to downside risks for consumer spending going forward. For this reason, we have a bullish bias for EUR/USD in the week ahead, for the euro simply not being the dollar.”
Share
