Long EUR/USD at 1.1080 – Westpac

Analysts at Westpac are recommending to go long on EUR/USD pair at 1.1080 levels for the target price of 1.1280, while maintaining stop loss of 1.1015.

Key Quotes

“Rationale:

• Recent EZ data have beaten estimates with an apparent shift in trend from ever weaker activity reports

• Latest German new export and capital orders suggest a floor may been in place for a key driver of EZ’s economy

• EC has accepted Italy’s Budget proposals suggesting a less aggressive stance on annual assessments

• Regional rises in yields have lifted French 10yr OATs above zero

• Improvements in US-China trade stance lifts global risk sentiment and is now USD negative

• EU officials suggest that there is no imminent risk around EU-US auto negotiations despite lack of a deal

• Germany’s Fin Min appears to have broken the national hurdle towards the potential of an EU banking union.”

“Risks:

• US-China talks are still some distance from being assured and Dec signing could still be derailed

• Any deterioration in EU-US trade negotiations even if the mid-Nov. deadline appears to have been pushed forward

• EC’s lower growth forecasts feed into ECB and cause a further push in accommodative forward guidance

• Trump Tweets: either against US trade or Fed

• EUR/USD has been tightly range bound since mid-Oct. and may fail to find a directional push.”