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EUR: $1.05 Tested on Solid Volumes, Clearance Opens Post-US Election Highs

EUR
USCEEMEABulletMarketsForeign Exchange BulletsNorth America
  • EUR holding the post-PMI rally here, with EUR/USD testing $1.05 handle at typing for another YTD high. There's still a way to go before revisit post-US election highs ($1.0630 the level here) but we're seeing strong participation in the rally this morning, evident in EUR futures volumes being close to 80% above average for this time of day, and on track for the busiest session of the week so far.
  • PMI numbers are squeezing rates pricing here: as noted just above, we've added almost 4bps to year-end ECB implied rates, but the run higher in the currency is outpacing that of year-end OIS - likely thanks to the still solid net short EUR positioning that's deepened since November, making EUR sensitive to S/T squeezes.
  • We see the technical break in EUR this week signaling scope for further strength - with 1.0574 marking an important retracement point, and the next hurdle before post-election highs.
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  • EUR holding the post-PMI rally here, with EUR/USD testing $1.05 handle at typing for another YTD high. There's still a way to go before revisit post-US election highs ($1.0630 the level here) but we're seeing strong participation in the rally this morning, evident in EUR futures volumes being close to 80% above average for this time of day, and on track for the busiest session of the week so far.
  • PMI numbers are squeezing rates pricing here: as noted just above, we've added almost 4bps to year-end ECB implied rates, but the run higher in the currency is outpacing that of year-end OIS - likely thanks to the still solid net short EUR positioning that's deepened since November, making EUR sensitive to S/T squeezes.
  • We see the technical break in EUR this week signaling scope for further strength - with 1.0574 marking an important retracement point, and the next hurdle before post-election highs.