Societe Generale on EUR/USD
Société Générale Cross-Asset strategy Research argues that around it is impossible to draw the chart of the EUR/USD around current levels, without noticing that the recent strength is looking exaggerated.
«The image we used is from the ECB in the now with easy monetary policy as a child might hold a ball at the bottom of a swimming pool. Once released, a rapid rise is inevitable. But now that we have seen that the place of losing momentum, there is more chance of a period of consolidation. Our year-end target of 1.18, our end of 2018 target 1.27. For the tactical of the euro bears, it’s now or never,» SocGen argues.
On the technical level, SocGen notes that the EUR/USD has reached the initial goal to 1.2070, which corresponds to 2012 lows.
«In light of the weekly indicators are the graphic ceiling, the short-term reaction of the air on the cards. Previous highs of 1.1714/1.1618 will be the near term support levels. A go beyond of 1.2070 is essential for the next stage of the uptrend,» SocGen adds.
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