23 Feb 2015
EUR/USD extension towards 1.1550 possible – BMO
FXStreet (Barcelona) - The Research Team at BMO Capital Markets, shares the outlook for EUR/USD into this week, expecting the pair to make a run higher towards 1.1550 if the Greece hurdles clear.
Key Quotes
“There appears to be strong resistance at 1.1450, which may not break until after the Greece’s creditors rule on the Greek reforms list late Monday or Tuesday. That resistance level may even hold through Wednesday, when the ECB is due to make a decision on an extension of the Emergency Liquidity Assistance (ELA) programme for Greek banks.”
“If we get to Thursday and it appears that all hurdles will be cleared on time, then a further extension higher to 1.1550 is possible.”
“However, if we get to the middle of next week and the deal appears to be unraveling, we expect EURUSD to break initial support at 1.1270 and fall to 1.1200. If the deal were to completely unravel before the end of week, EURUSD could easily make a run for the January low of 1.1098.”
“As long as Fed’s Yellen refrains from seriously undermining the USD, we expect EURUSD strength to be limited to 1.1550 next week.”
“Capital outflows, ECB QE and the EUR-funded carry trade should all offset the positive impact on the EUR from a near-term Greek resolution.”
Key Quotes
“There appears to be strong resistance at 1.1450, which may not break until after the Greece’s creditors rule on the Greek reforms list late Monday or Tuesday. That resistance level may even hold through Wednesday, when the ECB is due to make a decision on an extension of the Emergency Liquidity Assistance (ELA) programme for Greek banks.”
“If we get to Thursday and it appears that all hurdles will be cleared on time, then a further extension higher to 1.1550 is possible.”
“However, if we get to the middle of next week and the deal appears to be unraveling, we expect EURUSD to break initial support at 1.1270 and fall to 1.1200. If the deal were to completely unravel before the end of week, EURUSD could easily make a run for the January low of 1.1098.”
“As long as Fed’s Yellen refrains from seriously undermining the USD, we expect EURUSD strength to be limited to 1.1550 next week.”
“Capital outflows, ECB QE and the EUR-funded carry trade should all offset the positive impact on the EUR from a near-term Greek resolution.”