8 Nov 2013
Flash: NFP is looming. What can we do with the EUR/USD? – Commerzbank and Scotiabank
FXstreet.com (Edinburgh) -The EUR/USD is now gathering pace above the 1.3400 handle, as markets gear up for the US Payrolls due in the European afternoon. Recall that prior surveys expect the US economy to have created 125K jobs during October vs. September’s 148K.
Karen Jones, Head of FICC Technical Analysis at Commerzbank, argued “the uptrend gave way and the market dived down to the next support at 1.3294, the 50% retracement of the move up from July. We also believe that this was enough to complete the bear flag pattern which offers us an immediate downside measured target to the 1.3105 low and the 1.3165 61.8% retracement”.
In light of the recent ECB rate cut, Chief Strategist Camilla Sutton at Scotiabank commented “We do expect EUR to weaken from here and hold a year-end 1.31 target; however as the Fed works hard to communicate that even in an environment of tapering, Fed policy is still loose and interest rates are on hold for an extended period, the impact on EUR is likely to be more subdued than it was in February. We favour EUR short positions”.
Karen Jones, Head of FICC Technical Analysis at Commerzbank, argued “the uptrend gave way and the market dived down to the next support at 1.3294, the 50% retracement of the move up from July. We also believe that this was enough to complete the bear flag pattern which offers us an immediate downside measured target to the 1.3105 low and the 1.3165 61.8% retracement”.
In light of the recent ECB rate cut, Chief Strategist Camilla Sutton at Scotiabank commented “We do expect EUR to weaken from here and hold a year-end 1.31 target; however as the Fed works hard to communicate that even in an environment of tapering, Fed policy is still loose and interest rates are on hold for an extended period, the impact on EUR is likely to be more subdued than it was in February. We favour EUR short positions”.