FxWirePro Medium Term Outlook: Euro to Drop 1400 Pips Against Loonie
Euro is not and definitely not will be immune to Brexit. French may declare that Sterling will drop more than 20% against Euro but that may not turn out to be the case. Both are likely to fall against their major trading counterparts.
Other side of the leg, Canadian Dollar has been best performing developed market currency this year after Japanese Yen. Loonie is up more than 7% against Dollar YTD and currently trading at 1.285 per Dollar, but was up around 1.25 against Dollar, before falling in past few days.
Though, oil is down this week, it has gained in previous four and rational or not, likely to extend its rally over the coming weeks. So Loonie is also expected to perform well, while investors either pull out of Euro or hedge against volatility.
Trade idea –
Sell Euro at current price of 1.468 with 1.32 as target and 1.51 area as stop loss. Recent low around 1.41 area and psychological 1.4, likely to act as major support to the pair.