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BNP Paribas suggested to make a short with EUR/USD with 1.0900 target and 1.1630 stop loss, and it is based on 3 fundamental reasons:
- "Further risk-on – Eurozone capital outflows resume and markets start to reprice Fed hikes = EURUSD lower."
-
"Stable risk – Without a strong impulse from risk
sentiment, the eurozone’s trade surplus is probably still putting some
natural upward pressure on EURUSD. But with valuations already
expensive, EUR funding should be more attractive = no clear signal for
EURUSD."
-
"Return of risk-off – EURUSD continues to rally,
which forces the ECB to step up dovish rhetoric and ultimately ease
policy = EURUSD first higher, then lower."
"We entered a short EUR/USD position with a target at 1.0900, and a stop at 1.1630."