EUR/USD, EUR/JPY, EUR/GBP …. expect further downside … HSBC’s support and resistance levels

Author: Eamonn Sheridan | Category: News

From HSBC … let’s start with these:

HSBC Euro short term techanical analysis direction 10 September 2014

 

 

 

 

 

 

euro HSBC support resistance 10 September 2014

 

 

(Note from 8 Sep.)

More (bolding mine):

  • We expect further EUR downside in the short-term as the divergence in economic and policy outlooks is set to remain abundantly apparent over the coming weeks
  • The announcement effect of the surprise interest rate cut and the planned nonconventional easing has already provoked a sizeable knee-jerk drop in the EUR. But we believe the adjustment has further to run, especially into the Fed meeting and alongside stronger US data
  • One aspect of this easing that FX will be mindful of is that the ECB has become clearer that they view a lower currency as an important part of the solution. The ECB’s Nowotny said the latest interest rate cut “was mainly meant to lead to a reversal of the euro appreciation. The key was the influence on the exchange rate”.
  • The ECB has moved from not talking about FX, to claiming the exchange rate was just part of the inflation outlook, to accepting that it has become a policy target.
  • If you want to buy the EUR, it now means betting against the ECB. Rhetoric and action from the central bank will have one eye constantly on the exchange rate.

And:

  • IMM data points to a clearly stretched position in the EUR, and our technical analysis points to an oversold position in EUR-USD
  • But it is not clear where the trigger for a lasting squeeze will come from
  • The reaction in EUR-USD, for example, to the softer than expected US employment report was a relatively feeble squeeze higher. If the pull-backs are not painful, an extension lower is likely
  • Unless things are tripped up by the Fed or US data, we would expect to see EUR-USD head lower to 1.2800 and perhaps even challenge last year’s lows around 1.2750.

Some good items in there to add to your list.

By continuing to browse our site you agree to our use of cookies, revised Privacy Notice and Terms of Service. More information about cookiesClose