EUR/USD is trading on the higher ground once again, topping 1.14 and with one eye on 1.15. Can it make the move? Here are three opinions:
Here is their view, courtesy of eFXnews:
EUR/USD: Bullish But Mind ECB Reaction On A Move ‘Well Beyond’ 1.15 – Credit Suisse
Credit Suisse FX Strategy Research has been generally bullish on the EUR since March.
CS maintains this EUR bullish view on the ground that the better-than-expected growth and political outcomes combined with its “under-owned” structural position should give the EUR room to rally further.
However, CS suspects that inflationary forces are still not strong enough to tolerate sustained EUR/USD rally well beyond 1.15 without prompting central bank reaction.
CS targets EUR/USD at 1.15 in Q3.
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EUR: Staying ‘Comfortable’ With Our View For A Higher EUR/USD – NAB
NAB FX Strategy Research remains ‘comfortable’ with its view for higher EUR/USD on the back of the solid and increasingly broad economic recovery in the Euro Zone, against a shifting dynamics in the US.
“Euro Area’s surveys and customer conversations highlight renewed optimism and unity. French President Macron’s decisive parliamentary victory, with opposition support, points to him meeting little meaningful resistance in upcoming labor market reforms. There will be some high-profile protests of course, but this will have little effect in reality.
….Speculative positioning is long – but now slipping back and the USD, having dropped below its Trump 9 November rally start levels, and now awaiting data that will either prove the Fed’s inflation and economic growth optimism correct or not,” NAB notes.
EUR/USD: FX Market Has A ‘Great Wish’ To Buy Dips; Next Leg Higher Ahead – SocGen
Societe Generale FX Strategy Research notes that the tone of the FOMC and the trend in the data point to a pedestrian pace of tightening, supporting range-trading in treasuries and sending FX markets elsewhere in search of catalysts for movement.
In particular, SocGen thinks that it seems that there is a great wish within the FX market to buy EUR/USD on a decent dip, and there’s a recipe for a spike higher if triggers a break of EUR/USD 1.14.
On the JPY front, SocGen remains bearish and prefers to express that via long EUR/JPY and AUD/JPY exposures.
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