EUR/USD: analysts prepare to sell on ups
Westpac: “Improvement in Euro zone Jan PMIs was encouraging but not a game changer. Short term core EZ-US yield spreads have slipped to their least EUR supportive levels in 2 months, suggesting EUR is more fairly valued nearer $1.30/1.32. EUR/USD should continue to meet sellers with a $1.37 handle, with the expected FOMC taper and decent US GDP likely to reinforce underlying the growth divergence story”.
Commerzbank: “It’s possible that the rally towards the $1.3745/50 61.8% retracement is the maximum upside that we will see and the correction is already over. However, it’s not clear and we must allow for possibly $1.3810 before we fail”.
Nomura: “Short-term, there is a small pivot zone at $1.3650 but then a vacuum of support down to $1.3580. Resistance is $1.3717/40. Ultimately we need to see a Friday close below the July uptrend (1.3668) to confirm this outlook.”
Credit Suisse: Sell limit at $1.3745, with a stop above $1.3820, and a target at $1.3590.
Chart. H4 EUR/USD