EUR/USD: May Hit 1.20 First If Not Correcting In August – SocGen

0

EUR/USD has recorded strong gains lately. What is the outlook for the pair?

Here is their view, courtesy of eFXdata:

Societe Generale Research discusses EUR/USD outlook and flags a scope for EUR/USD hitting 1.20 if not seen a correction in the near-term.

“Gold has stalled but it usually enjoys August. But so does the dollar and if we get end-July dollar buying, that could increase the short-covering pressure. As noted before, if EUR/USD doesn’t correct in August, not sure if it will before getting to 1.20,” SocGen notes.

“The long-term bullish case is enhanced by the sense that Europe is weathering the pandemic better, but new European lockdowns would change that and in any case, it has simply risen too fast. The 14-Day EUR/USD RSI (see chart) has spiked above 70 for the third time in 5 months, after not doing so since early 2018. If nothing else, that represents a speed-bump, particularly if we get positive noises from Washington and a further Treasury sell-off,” SocGen adds.

m25.PNG

For lots more FX trades from major banks, sign up to eFXplus .
By signing up for eFXplus via the link above, you are directly supporting Forex Crunch.
Get the 5 most predictable currency pairs

About Author

Kenny Fisher - Senior Writer A native of Toronto, Canada, Kenneth worked for seven years in the marketing and trading departments at Bendix, a foreign exchange company in Toronto. Kenneth is also a lawyer, and has extensive experience as an editor and writer.