EUR/USD remains under pressure – Scotiabank

Shaun Osborne, Chief FX Strategist at Scotiabank, sees the pair still vulnerable in light of the upcoming ECB meeting and against the backdrop of a potential rate hike by the Fed.

Key Quotes

“This week’s ECB meeting is expected to see policy settings left unchanged but forecasts updates may reflect modest upgrades for growth and inflation – a plus for the central bank’s aggressive easing steps. We see limited scope for the EUR to improve with the Fed in play, however, and look for wider short-term rates spreads to continue pressuring spot”.

“Neutral on the day, after the rebound from the overnight test of 1.1100 but negative more broadly considering a fourth weekly loss though Friday following the early May rejection of 1.16+, loss of support around key medium term MA signals on the daily chart in the 1.12/1.13 area and a well-entrenched bear trend (resistance at 1.1175 today) on the intraday chart. Expect gains to stall in the upper 1.11s”.