Forex Flash: EUR/USD expected to gain in the near-term - Wells Fargo
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EUR/USD
FXstreet.com (Córdoba) - In the near-term, the Wells Fargo analyst team expects the euro to gain "as the European Central Bank steps up its policy response to the regions debt crisis, prompting more balanced market sentiment and FX positioning".
However, over the long-term, analysts still expect the euro to gradually decline, "given the underlying trend of Eurozone economic underperformance and potential further expansion of the central bank's balance sheet".
According to Wells Fargo, technicals are slightly negative for the euro. "The 20-day MA remains below the 50-day MA. The RSI is neutral at 47, but other momentum indicators are consistent with euro declines".
"To the downside, the main support levels for the euro are $1.2241 (recent low), $1.2134 (early August low), and $1.2042 (July low). There should also be strong support at $1.1876 (June 2010 low)", they say. "On the upside, expect resistance from prior highs at $1.2444 (August), $1.2693 (late June), and $1.2748 (mid-June). Downtrend resistance since August 2011 is also currently near $1.2830".
However, over the long-term, analysts still expect the euro to gradually decline, "given the underlying trend of Eurozone economic underperformance and potential further expansion of the central bank's balance sheet".
According to Wells Fargo, technicals are slightly negative for the euro. "The 20-day MA remains below the 50-day MA. The RSI is neutral at 47, but other momentum indicators are consistent with euro declines".
"To the downside, the main support levels for the euro are $1.2241 (recent low), $1.2134 (early August low), and $1.2042 (July low). There should also be strong support at $1.1876 (June 2010 low)", they say. "On the upside, expect resistance from prior highs at $1.2444 (August), $1.2693 (late June), and $1.2748 (mid-June). Downtrend resistance since August 2011 is also currently near $1.2830".
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