EUR: Second consecutive weekly fall? – BBH

Barring a strong rally in North America, the euro will finish lower for the second consecutive week, points out the analysis team at BBH.  

Key Quotes

“It would be the first back-to-back decline in six months.  The price action confirms our suspicions that the short-term market has changed to sell euro bounces rather than buy dips.  If the euro finishes the week below $1.17, it would be the first time since late July.  The mid-August lows were recorded near $1.1660, and we have suggested that a potential head and shoulders pattern projects toward $1.1600.”

“To be sure, barring the lowflation, the eurozone economic activity remains elevated.  That was the takeaway from the PMIs.  Germany reported a surge in August industrial order today.  The 3.6% rise is the strongest in three years.  This is a seasonally and inflation adjusted reading.  The strength was broad-based, with domestic orders increasing 2.7% and export orders rising 4.3%.  Today's report suggests upside risk to news week's industrial output report, where the median is expecting a little less than a 1% increase.”