20 Feb 2015
EUR/USD upside capped at 1.1450/00, even on a 11th hour Greek deal – TDS
FXStreet (Barcelona) - Shaun Osborne, Chief FX Strategist at TD Securities, explains that USD looks fully priced in the current environement, and that EUR’s upside progress to any significant level is highly unlikely even on a last minute deal between Eurogroup-Greece.
Key Quotes
“The USD folded easily, along with US yields, at the sight of the dovish headlines surrounding the release of the January FOMC minutes earlier in the week.”
“The headlines certainly read a little softer than the market had expected—perhaps given that expectations have been conditioned by the stronger US NFP report released earlier this month and after the last Fed policy meeting took place—but the reaction to the USD reflects our concern that the USD looks fully priced in the current environment, with a lot of good news already factored from the USD’s perspective—and bad news priced in to the EUR to the extent that the bid to broker a deal between Greece and the EU etc. is hardly having any impact.”
“We remain bullish on the USD but think it may struggle to progress materially until we get harder evidence of the Fed moving towards rate lift off or more bearish news—negative data, Greek developments or hints of further easing measures to come from central banks elsewhere.”
“Equally though, we doubt the EUR will progress to any significant extent in the event of an 11th hour deal on Greece. We still rather see 1.1450/00 as the top of the range for the moment.”
Key Quotes
“The USD folded easily, along with US yields, at the sight of the dovish headlines surrounding the release of the January FOMC minutes earlier in the week.”
“The headlines certainly read a little softer than the market had expected—perhaps given that expectations have been conditioned by the stronger US NFP report released earlier this month and after the last Fed policy meeting took place—but the reaction to the USD reflects our concern that the USD looks fully priced in the current environment, with a lot of good news already factored from the USD’s perspective—and bad news priced in to the EUR to the extent that the bid to broker a deal between Greece and the EU etc. is hardly having any impact.”
“We remain bullish on the USD but think it may struggle to progress materially until we get harder evidence of the Fed moving towards rate lift off or more bearish news—negative data, Greek developments or hints of further easing measures to come from central banks elsewhere.”
“Equally though, we doubt the EUR will progress to any significant extent in the event of an 11th hour deal on Greece. We still rather see 1.1450/00 as the top of the range for the moment.”