FXStreet (Guatemala) - Jane Foley, Senior Currency Strategist at FXStreet explained sentiment for a stronger dollar.
"The severe winter in the US and the associated spate of shockingly soft data had the effect of forcing the market to rethink the optimistic forecasts for the USD that had been common place at the start of this year".
“CFTC data show that speculators’ positions held negative between late February and early June.”
“The fact that the market was short USDs provided the spring board for its recent rally”.
“While we expect the pace of further USD gains to be kept in check by the Fed doves, we have revised our 12 mth EUR/USD> forecast moderately to 1.28 from 1.30”.
“Our upgraded USD forecasts are also reflected in other crosses. We see scope for GBP/USD to edge to 1.66 medium-term”.