The markets' reaction to the latest Fed words suggest that the dollar weakness against most G10 FX seen since late May was a position unwind, rather than a harbinger of things to come, says Deutsche Bank.
"Indeed, the dollar has rallied against all G10 currencies since the FOMC meeting, and in most cases the size of the rally has been proportionate to the size of dollar weakness seen before. European currencies should therefore start to weaken against the dollar," DB adds.
Morover, DB notices another bearish factor for EUR/USD is that its Euro-area data surprises index appears to be running close to its recent years’ highs, while US data surprises are only now starting to turn
On top of that, DB's positioning measures suggested that long euro positions ahead of FOMC reached their highest levels since 2009.
"Therefore, much of the relative good news on the euro appears priced, and so the euro should at the very least head to the low-end of this year’s range of 1.28 in the coming months," DB projects.
As such, DB advises its clients to stay core short EUR/USD as long as we hold below the recent highs, and to add to shorts on a bounce up to 1.3265/70 area. S/T, DB sees the pair targeting the 1.3070-90 area where the 55, 100 and 200 dma all lie.
Read More: http://www.efxnews.com/story/19384/keep-faith-stay-core-short-eurusd-add-bounces-deutsche-bank
Read More: http://www.efxnews.com/story/19384/keep-faith-stay-core-short-eurusd-add-bounces-deutsche-bank
0 commentaires:
Enregistrer un commentaire