November 26, 2022

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EUR: Another false dawn near 1.22; fade for 1.18

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EUR/USD strategy from TD

EUR/USD strategy from TD

TD Research discusses its expectations for tomorrow’s ECB meeting and likes selling EUR/USD around 1.22.

“The ECB also meets this week and, they may attempt a backdoor taper.
Still, they will most likely maintain the language in the press release
that PEPP purchases will continue “at a significantly higher pace than
during the first months of the year.” The upshot is that it would be viewed as a dovish outcome, especially as markets have been expecting more hawkish shifts recently,” TD notes. 

“To this end, the EUR is likely to mark another false dawn near the 1.22 level, where we like fading, give or take a few pips. Still, a high-level view of key currency drivers doesn’t argue for much more upside from here. Instead, we’re expecting it to hold a 1.18-1.22 range for most of the year,” TD adds.

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