Euro set to post first monthly loss since January - BBH

Research Team at BBH, notes that the euro struggled to maintain even the slightest of upticks as the two-year spread between the US and Germany widened out to almost 145 bp from less than 129 bp on March 20. 

Key Quotes

“The euro fell for the fourth consecutive week and the sixth of the last seven weeks.  Barring a significant surprise in the first couple of sessions next week, the euro is set to post its first monthly loss since January. 

The euro's technical condition remains poor. Since the break of $1.12, we have been looking for $1.1070. It corresponds with a retracement objective and where a trend line drawn off last December's and mid-March lows intersect at the end of next week.  It is also just below the 200-day moving average, just above $1.11, that held before the weekend.  The euro is pulling back after moving briefly above $1.16 at the start of the month. 

We are watching closely for a technical signal of an upside correction that we anticipate before the $1.10 area yields. If we are wrong, a break of $1.0940 points to a return to $1.08.  On the upside, initial resistance is seen in the $1.1200-$1.1250 band.”