EUR/USD: Gains might extend to 1.0675/1.0725 – Scotiabank

EUR/USD recovers to 1.06 area. Economists at Scotiabank analyze the pair’s outlook.

EUR is oversold and there is ample room for a correction

Two solid up days (so far) for the EUR barely make a dent in the sustained sell-off seen since July’s peak but EUR is oversold and there is ample room for a correction – at least – in recent losses.

The EUR remains down on the week but the weekly candle pattern reflects a potential ‘hammer’ signal which will support the impression of a low developing around this week’s test of the 1.05 area. Gains might extend to 1.0675/1.0725.

Support is 1.0575/1.0600.