EUR/USD fade the upticks – Scotiabank

FX Strategists at Scotiabank have recommended selling the pair on occasional rallies in the short term.

Key Quotes

“EURUSD is holding in a range; better Eurozone activity data this week (Germany’s IFO survey rose to its strongest since 2014 at 110.5) have failed to lift sentiment as investors believe the ECB is liable to ease policy again due to low inflation and lower inflation expectations”.

“A large EURUSD option expiry today at 1.09 (EUR 2.4bn notional) today suggests range trading may persist through early trading. We prefer sell EURUSD rallies”.

“EURUSD is consolidating recent weakness. We see limited scope for EUR gains through the low 1.09 area for now and rather look for losses to resume on a break under consolidation support at 1.0870. Intraday signals are tilting more neutral which favours range trading. Fade EUR rallies”.