Euro closing out its fifth consecutive monthly advance - BBH

Analysts at BBH point out that the euro is up 11.5% so far this year and is closing out its fifth consecutive monthly advance with a three-week streak.

Key Quotes

“Before the last trading session, the euro was the strongest major currency year-to-date against the dollar.  However, the dramatic quarterly expansion in Sweden of 1.7% sparked a sharp rally in the krona, which has eclipsed the euro.  In any event, the euro is up 11.5% so far this year and is closing out its fifth consecutive monthly advance with a three-week streak.’

“The euro approached $1.1780 before consolidating ahead of the weekend. The technical indicators are near extreme readings.  The weekly RSI is at its highest level in a decade.   Yet none of the indicators have turned down.  As it has done for most of the month, it is climbing the alongside the upper Bollinger Band (~$1.1775).  Short-term traders seem quicker to take profits than they may have been before, and participants should continue to be sensitive to reversal patterns that would signal a potential pull back.  The near-term trendline drawn off the lows from the second half of June and mid-July is found near $1.1550 to start the new week and nearer $1.16 at the end of the end.”