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27 Mar 2015
Yellen expected to be dovish, go long EUR/USD – Growth Aces
FXStreet (Barcelona) - With Fed’s Yellen set to speak later in the day, the Growth Aces Research Team expects the tone of the speech to remain clearly dovish, and hence remain bullish on EUR/USD targeting 1.1180 levels.
Key Quotes
“US CFTC information revealed that non-commercial EUR net short positioning widened further ahead of the March FOMC meeting to levels last seen in the middle of 2012. Such extreme bearish bets on the EUR have the potential to generate a sustainable pullback in a period when the Fed is communicating a less aggressive policy tightening and when Eurozone macroeconomic data have started surprising on the upside.”
“Despite yesterday’s USD rally we are still the opinion that EUR/USD have bottomed out. Further strengthening of the USD will be harmful to U.S. economy and will result in further delay of Fed rates hikes.”
“Traders will be listening closely to a speech by Fed Chair Janet Yellen scheduled for 19:45 GMT. Is she likely to sound hawkish enough to restore expectations for early Fed hikes? We think it is doubtful.”
“That is why we decided to use lower EUR/USD levels to get long again at 1.0860 yesterday and keep our target at 1.1180.”
“The strong resistance area 1.1030/50 may be broken as soon as today in case of clearly dovish Yellen’s speech.”
Key Quotes
“US CFTC information revealed that non-commercial EUR net short positioning widened further ahead of the March FOMC meeting to levels last seen in the middle of 2012. Such extreme bearish bets on the EUR have the potential to generate a sustainable pullback in a period when the Fed is communicating a less aggressive policy tightening and when Eurozone macroeconomic data have started surprising on the upside.”
“Despite yesterday’s USD rally we are still the opinion that EUR/USD have bottomed out. Further strengthening of the USD will be harmful to U.S. economy and will result in further delay of Fed rates hikes.”
“Traders will be listening closely to a speech by Fed Chair Janet Yellen scheduled for 19:45 GMT. Is she likely to sound hawkish enough to restore expectations for early Fed hikes? We think it is doubtful.”
“That is why we decided to use lower EUR/USD levels to get long again at 1.0860 yesterday and keep our target at 1.1180.”
“The strong resistance area 1.1030/50 may be broken as soon as today in case of clearly dovish Yellen’s speech.”