Euro Consolidation Holds at Mid-1.15s Against US Dollar
The Euro has been consolidating in the mid-1.15s against the US Dollar, according to Scotiabank strategists Shaun Osborne and Eric Theoret.
This stability follows a decline in the Dollar driven by the Federal Reserve's actions in late July.
The EUR/USD pair is trading close to its fair value estimate based on 2-year Germany-US yield spreads, which currently stand at 1.1563.
Correlation studies show that sentiment-driven movements are strengthening, while fundamentally driven movement has moderated.
Bullish momentum for the Euro is fading, with the RSI drifting into the upper 50s and a series of higher highs and lower lows indicating deceleration in its recovery from late July.
The near-term range bound is expected to be between 1.1500 and 1.1580, with resistance at 1.1600 and the 200-day moving average at 1.1630, while support lies at the 50-day MA of 1.1468.