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EUR/USD Outlook

It is a perfect storm for EUR/USD. It has dropped 9.7% or 12 big figures since the start of January and at this rate could be trading below parity in Q2.
 
Sovereign debt purchases by the ECB and a realignment to the upside of market expectations with the Fed's own forecast of the Fed funds rate in the period ahead may keep selling pressure intact and EUR/USD destined for parity. 

Societe Generale notes in a report on Monday:

  • The 1.0765 and 1.05 technical areas are key intermediate levels of support to watch in the coming weeks.
  • Though long USD speculative position are already stretched, the downtrend may not change very soon if the noose continues to tighten around Greece's neck

  • Market Data
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