Euro Dollar Rate Forecasts for 2014-2015 - page 10
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EUR/USD: Near Next S/T Sell-Off
The US dollar suffered a beating of late. Is it time for a comeback against at least one currency?
Here are the views from ING:
Here is their view :
EUR/USD prices improved significantly over the past few days, violating the short-term bearish view.
“The daily chart shows that prices are building momentum after the break above the MA- 50 line at 1.0887, suggesting further gains in the next few days,” notes ING.
“However, we consider the short-term upside potential to be limited with next horizontal resistance coming in within the 1.1030-1.1045 area. From here we should expect the next short-term sell-off,” ING projects.
“The longer-term picture is following our path of a larger consolidation pattern in the downtrend between 1.0450/1.0150 at the lower side and 1.1490/1.1660 at the upper end. All in all, we raised our short-term rating to ‘Neutral’ from ‘Down’,” ING adds.
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EUR/USD: Bears Get Ready
The greenback suffered a massive sell-off. Nevertheless, we have already noted some dollar bulls.
And here are more. The team at Bank of America Merrill Lynch explains:
Here is their view :
Despite its recent sideways price action, Bank of America Merrill Lynch remains bullish and long USD/JPY.
“Evidence says that the bull trend of the past 4+ months is drawing to a conclusion and the long-term uptrend is set to resume for 124.59, ahead of 128.45,” BofA argues.
“Below 118.33 invalidates this view and points to continued range-trading, while those awaiting additional price confirmation need a break of 120.86 (the Apr-13 high),” BofA adds.
In line with this view, BofA maintains a long USD/JPY position with a stop at 118.32, and a target at 124.59.
Turning to EUR/USD, BofA notes that since mid-March, the pair has been caught in an increasingly well defined contracting range and while this range can persist for another week or two, it is nearing its conclusion.
“Indeed price should not exceed 1.1000 and can’t exceed the Mar-26 high at 1.1053. With seasonality about to turn bearish (May is the second weakest month of the year for EUR/USD), its almost time to get short again,” BofA projects.
“GET READY. Downside targets are seen to 1.0283 ahead of parity. Below 1.0550/1.0521 (Triangle support & Apr-13 low) says the downtrend has resumed,” BofA advises.
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no wonder they are having problems
no wonder they are having problems
Market makers are keeping their short positions opened since 1.15-1.16. The do not care for a 100 or 200 pips.
Market makers are keeping their short positions opened since 1.15-1.16. The do not care for a 100 or 200 pips.
Or a billion here or there
They will apply to FED printing series nnn 
EUR/USD: Euro Bears Will Push It to $1.04 in 12 Mths: Rabobank
The ongoing impressive - and surprising to many - rebound in the euro against the dollar won't last long, Rabobank warned in a note on Friday, as the key driving factors behind the moves in the EUR/USD pair - monetary policy divergence - remain unchanged.
"EUR/USD ended the last day of trading in April extending its impressive (and painful for the EUR bears) gains to $1.1266 high," the note said. "For the first time since the downside trend started in July 2014 EUR/USD posted monthly gains after opening at $1.0731 and trading as low as $1.0521 in April."
The shared currency was traded 0.25% higher at $1.1251 during Friday's US session after hitting $1.1271 earlier in the day, its highest since late February.
Surprising rally
".. the scale of EUR rally took us by surprise. So how far could this rebound extend? $1.1265/80 is the key level to watch at this stage (the 38.2% Fibonacci retracement from the December high and daily lows throughout February)," Rabobank further said.
While a break higher would be another constructive short-term signal, one would have to be very brave to chase EUR/USD much higher ahead of the crucial US non-farm payrolls scheduled for next Friday, the bank said. Economic desks anticipate a fairly decent 230,000 increase in payrolls in April after March's disastrous 129,000.
Looking ahead, Rabobank opined: "As for the long-term outlook, we maintain our view that EUR/USD will be trading at $1.04 in 12 months as the key fundamental driving factors remain intact."
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This is the best comment I have seen : NFP can not be worse than it was last month, and that means just one thing
EUR/USD: A Buy Signal Or A Warning Signal- JP Morgan, ING
EUR/USD continues defying gravity, continuing higher when other currencies slip against the dollar.
Here are two different opinions on what’s next for euro/dollar:
Here is their view :
JPM: The bears are on alert, but remain in control for the time-being.
“The break above pivotal resistance at 1.1053/98 sent a first serious warning signal to the ruling bears and opened the door for an extension to the next major T-junction at 1.1267/79 (int. 38.2 % on 2 scales),” JPM clarifies.
“It would take a break above the latter though to really jump scales in favor of a much broader recovery to 1.1534 ((February high) and most likely to the main T-junction on big scale at 1.1699 (int. 38.2 % on higher scale). Breaks below 1.1053 and 1.0987 (pivot/minor 38.2 %) would on the other hand provide fresh support for the bears,” JPM adds.
ING: A buy signal: upgrade rating from ‘neutral’ to ‘up’.
“Prices were very strong yesterday, breaking the horizontal resistance area 1.1030/1.1045. This was a surprise on a short-term basis as we expected a mild pull-back after a test of the 1.1030/1.1045 resistance area, although it confirms the view of a larger consolidation pattern in the next few months,” ING notes.
“The break above the horizontal resistance area 1.1030/1.1045 triggered a Buy signal completing the bottom formation on the upside, suggesting a move towards the upper end of the long-term trading range between 1.1490 and 1.1660. We upgrade our rating to ‘Up’ from ‘Neutral’ and recommend buying the dips towards the bottoming MA-50 line at 1.0879,” ING advises.
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4 reasons US dollar will rebound - BNP Paribas
BNP Paribas taken out of short EUR/USD trade last week but they keep the faith."Against expectations, the FOMC announcement this week was less of a marketmoving event than the earlier release of the very weak US Q1 GDP data.
The resulting USD weakness has taken us out of our short EURUSD spot recommendation from 25 March. We do not think the current USD weakness represents the start of a new trend, and restate our bullish USD view over the coming months for the following key reasons:
1- Unchanged Fed tightening expectations - the FOMC statement does not change our economists' view for Fed tightening in September.
2- US growth will rebound in Q2 - the factors suppressing Q1 GDP are likely to prove temporary.
3- US front-end yields will rise - if data improve in line with our expectations, US 2-year yields will rise. The USD yield advantage will widen again.
4- FX positioning is not crowded - USD long exposure has this week fallen to its lowest level for 2015 at +13 (on our scale of -50 to +50). If the above three points prove correct, there is considerable potential for a rebound."
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Is This The End Of EUR-Funded Carry Trades? – Credit Agricole
With EUR/USD showing a lot of strength, it is time to ask whether one of the drivers lower has materially changed, especially as bunds have changed course.
Here is the take from Credit Agricole:
Here is their view :
EUR remains surprisingly resilient as investors worry that the ECB may taper its QE before long in the face of returning inflation and recovering economy. This is pushing short rates and EUR higher as EUR-funded carry trades get unwound.
Surging bond yields and weaker stocks are helping as well because investors are cutting short-EUR hedges as they reduce their Eurozone-exposure. Indeed, EUR basis swap rates are bouncing off the lows pointing at waning appetite to sell EUR forward.
Is this the end of EUR-funded carry trades? We doubt it. We think it is premature to expect that the ECB will be adjusting QE anytime soon. Indeed, Eurozone inflation expectations have stabilised but remain close to the lows. In addition, Greece will remain a worry even as hopes for a deal between Athens and its creditors are growing ahead of the 11 May Eurogroup meeting.
In particular, we think that fears about Grexit could intensify again once Athens and its creditors start negotiating a third sovereign bailout later on this year.
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