Technical tone and sentiment improves – Scotiabank

EUR/USD holds near 1.06. Economists at Scotiabank analyze the pair’s outlook.

Minor new highs above 1.0640 should trigger a push on to the mid/upper 1.07s

Positioning may be fueling support for the EUR to some extent but a further shift in relative economic surprises should give the EUR some more obvious fundamental support.

The EUR is still struggling to extend gains through the low 1.06 area which could/should point to a bit more strength ahead. But the broader look of the charts is leaning EUR-bullish – steady gains from the early part of the month are holding and a firm (technically bullish) close to the week again last Friday which follows the bull ‘hammer’ pattern at the start of the month.

Minor new highs (above 1.0640) should see the EUR push on to the mid/upper 1.07s.