EUR/USD: Dead cat bounce? – OCBC

Euro (EUR) fell to a low of 1.0225 (2 Jan) before rebounding. The large slippage was likely due to poor market liquidity. Pair was last seen trading at 1.0353 levels, OCBC’s FX analysts Frances Cheung and Christopher Wong note.

Dovish expectation on ECB cut trajectory may unwound

“Mild bearish momentum on daily chart shows tentative signs of moderating while RSI rose. Rebound not ruled out.”

“In the event CPI comes in firmer, then dovish expectation on ECB cut trajectory may unwound. And that can add to EUR’s rebound momentum.”

Jan 6, 2025

USD: Rally may lose some steam – ING

The Christmas holiday period was not particularly eventful for FX markets, but it was again remarkable how the dollar kept finding support, defying both seasonal negative pressure and a brief rally in US Treasuries at the end of December.

EUR: Looking for a lifeline – ING

EUR/USD recovered some ground on Friday, in line with our expectations. From a valuation standpoint, there is still short-term upside potential for the pair, which at current levels embeds a risk premium of around 1.5-2.0%, ING’s FX analyst Francesco Pesole notes.