In view of FX Strategists at Scotiabank, the near term outlook on EUR/USD remains neutral with expected support in the mi/upper-1.1600s.
Key Quotes
“Yield spreads remain bearish however measures of sentiment appear to be offering considerable support as risk reversals soften from the extended (bearish) levels observed in May, June, and mid-July”.
“Bearish momentum indicators have softened to neutral however the trend strength indicators are remarkably muted reflecting the 1.1500-1.1850 range that has prevailed since mid-May. Recent congestion has centered around the 50 day MA and resistance has been observed in the mid-1.17s. We look to near-term support in the mid/upper-1.16s”.
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