FX Strategists at Scotiabank suggested the ongoing weakness in the pair could open the door to a test of 1.1448.
“Spot trading below 1.15 – the range base over the past few months and major support on the longer run charts – casts a bearish light over the immediate prospects for the EUR. EURUSD was looking soft anyway but we had expected the 1.15 area to hold”.
“Persistent weakness below this level could suggest a more negative outlook for the currency over the medium to longer-term, we feel. The impulsive nature of today’s decline allows for some tolerance for temporary weakness”.
“Sustained softness – and, more especially – a clear break of 1.1448 (50% retracement of the 1.03/1.25 rise) spells more weakness for EUR this year”.