USD remains firm, EUR/USD sees further decline – Danske Bank

Analyst at Danske Bank Mathias Mogensen has assessed the positive momentum around the greenback and prospects for EUR/USD.

Key Quotes

“The USD continues to strengthen particularly versus European currencies. In our view, the driving forces are rising political uncertainty in Europe and higher short-end US rates, which makes it costly to be short USD”.

“EUR/USD is grinding lower with the key technical support area coming in around 1.0950-1.1000. A clean downside break here could open the door for further losses. Short term, we think that EUR/USD has room to fall further as positioning appears to be light and the move lower is gradually suggesting that we are not at the end of the trend”.

“Meanwhile, EUR/GBP is consolidating around the 90 level. We continue to believe that EUR/GBP will consolidate short term as the moves appears stretched. Over the next three to six months, we look for a new leg higher towards 0.92-0.95 as the concerns about a hard Brexit will continue to weigh on the British pound (GBP)”.