EUR: No room left for further position-squaring downside risk; buy dips — Credit Agricole

Euro strategy

Credit Agricole CIB FX Strategy Research discusses EUR outlook in terms of positioning, noticing that speculative EUR positioning is back in balanced territory.

«This in itself suggests that there is no room left for further position squaring related downside risk. Hence, positioning acts as another indication of last week’s downside being a corrective move rather than a change in trend,» CACIB argues.

In terms of next week’s data calendar, CACIB notes that it is relatively empty when it comes to top tier data releases, expecting that Eurozone growth expectations should continue to be well supported.

Trade wise CACIB recommends buying EUR Dips and remains long EUR/USD* and EUR/CHF as trade recommendation.

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