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5 May 2015
EUR/USD heading lower again – TDS
FXStreet (Barcelona) - FX Strategists at TD Securities, believe that EUR/USD rebound might have run its course and turn lower again as US payrolls data might support the Dollar.
Key Quotes
“We are leaning strongly towards the view that the rebound in EURUSD through the end of April largely has largely run its course. Technically, we think last week’s peak around 1.13 satisfies retracement objectives (1.13 is more or less right on the 23.6% retracement of the 1.40/104 decline in spot seen over the past year) and coincides with a change in seasonal risks.”
“As bad as April is for the USD (the worst month of the year for the past 10 years), the seasonal shoe is on the other foot for in May (the best month of the year for the USD over the same period); since 1999, EURUSD has also tended to form an interim high for Q2 right at the end of April and head lower through much of May.”
“Much hinges on the flow of US data reports from here; we look for a pick up in US hiring again in April after the disappointing March data would be broadly USD-supportive.”
“Good US data will help solidify the peak in EURUSD we think we have seen.”
Key Quotes
“We are leaning strongly towards the view that the rebound in EURUSD through the end of April largely has largely run its course. Technically, we think last week’s peak around 1.13 satisfies retracement objectives (1.13 is more or less right on the 23.6% retracement of the 1.40/104 decline in spot seen over the past year) and coincides with a change in seasonal risks.”
“As bad as April is for the USD (the worst month of the year for the past 10 years), the seasonal shoe is on the other foot for in May (the best month of the year for the USD over the same period); since 1999, EURUSD has also tended to form an interim high for Q2 right at the end of April and head lower through much of May.”
“Much hinges on the flow of US data reports from here; we look for a pick up in US hiring again in April after the disappointing March data would be broadly USD-supportive.”
“Good US data will help solidify the peak in EURUSD we think we have seen.”