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EUR/USD remains a sell on strength – SG

FXStreet (Barcelona) - Alvin Tan, FX Strategist at Societe Generale, explains that accelerating capital outflows will weigh on the euro, and suggests waiting for an opportunity to sell EUR/USD strength.

Key Quotes

“There are fundamental forces weighing on the euro as capital outflows accelerate given ECB QE and the euro’s transition into a global funding currency. In the year to January 2015, euro area residents sent almost half a trillion euros in net portfolio outflows abroad.”

“We still see EUR/USD at parity in a year’s time. As such, we choose not to speculate on short-term EUR/USD bounces and would rather wait to sell into strength.”

“We would recommend non-USD short euro exposures at this time, namely EUR/NOK or EUR/SEK.”

GBP/JPY awaits UK employment data

The GBP/JPY trades in the sideways manner at 177.70 ahead of the data in the UK, which is expected to show a drop in the jobless claims and unemployment rate.
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EUR/GBP sidelined above 0.7200

EUR/GBP is navigating in a very tight range on Friday, following the consolidative stances in both the euro and the pound...
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