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EUR/USD Remains Soggy Ahead of ECB

EURO-DOLLAR
MNI (London)
  • Risk off through Wednesday saw EUR/USD pressed to a low of $1.1718 into early NY., the move taking its lead from a weakening in equity markets, position adjustments ahead of next week's US election, expected France lock down as well as month-end value USD demand.
  • Rate recovered to $1.1760 into the 1600GMT fix where it met decent resistance. Confirmation of the France lock-down, with Germany also announcing action, had little further effect.
  • Mild recovery in US equities in Asia provided some relief to recent downside pressure but rate remained below its Wednesday recovery high.
  • Early Europe pressed rate back to challenge early Asia low of $1.1744(fresh low $1.1742).
  • Heightened COVID concerns in Europe ups the focus on today's ECB policy announcement. Market looking for direction for the December meet. Slight chance of a surprise announcement due to current COVID concerns.
  • Wednesday's equity market moves has flipped month-end fix outlook to USD buys, according to one major US bank.
  • Support $1.1740, $1.1718/15, $1.1690/85. Resistance $1.1760, $1.1785/90.
  • Option expiries of note, $1.1720-25(E1.2bln), $1.1745-55(E1.6bln)
  • MNI Techs: Outlook remains bearish as the pair continues to test key near-term trendline support(1.1744) drawn off the Sep 28 low that was probed yesterday. Clear breach of the line would strengthen a bearish case and open 1.1689, Oct 15 low. Initial resistance is at 1.1798, Wednesday's intraday high.
MNI London Bureau | +44 203-586-2231 | john.webb@marketnews.com
BulletMarketsForeign Exchange Bullets
MNI London Bureau | +44 203-586-2231 | john.webb@marketnews.com
BulletMarketsForeign Exchange Bullets

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