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12 Dec 2014
EUR/USD may edge a little higher – TDS
FXStreet (Barcelona) - Shaun Osborne and Martin Schwerdtfeger, FX Strategists at TD Securities, note that EUR/USD is well supported above 1.24 levels, thereby opening up the possibility of a move higher towards 1.2575/1.2625 levels.
Key Quotes
“The DXY has suffered its biggest setback this week since mid October’s mini-pause. We continue to caution that seasonal pressures tend to weigh on the USD broadly through the December month but we also suspect that USD weakness is likely to remain relatively shallow and short-lived. The broader trend remains positive and event risk into the holiday period seems more likely to support that trend USD than not.”
“Firstly, we think the FOMC meeting next week will dump the “considerable time” reference to better align the market’s reluctance to buy into the notion of rising policy risks with the Fed’s growing confidence in the outlook. Secondly, strong US data reports are bolstering expectations that the third revision of the Q3 GDP data due on December 23rd could see GDP revised up to north of 4%.”
“We don’t rule out a little more in terms of EURUSD gains, for example, with the EUR well-supported above the 1.24 area this morning. EURUSD has done some damage to the longer-term technical bear trend this week, which opens up the charts for a modest squeeze towards 1.2575/1.2625—levels we think would provide a great opportunity for USD buyers.”
Key Quotes
“The DXY has suffered its biggest setback this week since mid October’s mini-pause. We continue to caution that seasonal pressures tend to weigh on the USD broadly through the December month but we also suspect that USD weakness is likely to remain relatively shallow and short-lived. The broader trend remains positive and event risk into the holiday period seems more likely to support that trend USD than not.”
“Firstly, we think the FOMC meeting next week will dump the “considerable time” reference to better align the market’s reluctance to buy into the notion of rising policy risks with the Fed’s growing confidence in the outlook. Secondly, strong US data reports are bolstering expectations that the third revision of the Q3 GDP data due on December 23rd could see GDP revised up to north of 4%.”
“We don’t rule out a little more in terms of EURUSD gains, for example, with the EUR well-supported above the 1.24 area this morning. EURUSD has done some damage to the longer-term technical bear trend this week, which opens up the charts for a modest squeeze towards 1.2575/1.2625—levels we think would provide a great opportunity for USD buyers.”