FXStreet (Córdoba) - Eric Theoret, Currency Strategist at Scotiabank, notes that the EUR/USD risk remains biased to further downside, given the massive divergence to yield spreads and bearish technical indicators.

Key Quotes



"EUR risk remains biased to further downside, given the massive divergence to yield spreads and the acceleration observed in bearish momentum indicators".



"Friday’s decline also highlights further downside risk to EUR given the negative reaction to Russia-related headlines, a reversal from the typical pattern observed since March. The reaction was likely the result of a focus on the consideration of escalating EU sanctions toward Russia with public officials voicing their support in spite of economic costs".



"Near term risk lies with broader developments, with no high level data scheduled for release before Wednesday".



"Both trend and momentum indicators are suggestive of further downside, however we note that the RSI has entered oversold territory between 20 and 30. Key downside levels include 1.3400 and the November 2013 low at 1.3296".



You May Also Like

COMPANIES IN THIS ARTICLE
Related Forex Analysis
  1. Forex News

    EUR/USD dips to fresh monthly lows near 1.0930

  2. Forex News

    Euro Drops on Greece Fears, Aussie Dollar Rises With Chinese Stocks

  3. Forex News

    EUR/USD: consolidation before pressuring 1.0900/10 – AceTrader

  4. Forex News

    EUR/USD Technical Analysis: Sellers Overcome 1.10 Figure

  5. Forex News

    Trading Video: Not a Clean Break for EURUSD or EURJPY

Trading Center