Don't be too surprised, SocGen says

Societe Generale Research discusses EUR/USD tactical outlook and sees a scope for a tactical dip below 1.11 followed by a bounce on short-covering.

"When the US economic slowdown gathers enough momentum, we will see a further inversion, a further fall in long yields around the world and a stronger yen across the board.

We might even shake EUR/USD out of its torpor and away from the pattern of tiny ranges and marginal new lows followed by tepid bounces. But that won't happen today. If we end May with a dip below 1.11 followed by short-covering, don't be too surprised," SocGen notes.

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