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FX Strategists at Scotiabank noted the pair’s upside momentum could reach the 1.1580 region.

Key Quotes

EUR is extending its recent recovery, testing fresh two week highs and threatening 1.15 in the aftermath of the U.S. midterm elections. Fundamental releases are delivering added support. Germany’s industrial production figures were stronger than expected and followed Tuesday’s solid factory orders and PMI releases. ECB rate expectations are recovering modestly and German-U.S. yield spreads are narrowing modestly. The Italian government has also won a confidence vote in the Senate and BTPs have fully retraced Tuesday’s decline. Risk reversals suggest a continued fade in the premium for protection against EUR weakness vs. both the USD and JPY. The one week risk reversal is even pricing a small premium for protection against EUR strength”.

“Momentum indicators are now firmly in bullish territory and the DMI’s appear poised to confirm. Near-term resistance appears limited between the psychologically important 1.15 level and the 50 day MA at 1.1553. We anticipate additional gains toward 1.1580. Support is now expected between 1.1400 and 1.1380″.