EUR/USD: Focus on 55-WMA at 1.1191 – Citibank

The Citi Group analysts offer fundamental and technical outlook on trading the EUR/USD pair in the medium-term.

Key Quotes:

“Although ECB actions are nonetheless designed with a weaker EUR in mind, US President Trump and his Administration are actively trying to cap $ upside both via firing warnings to the ECB and jawboning the Fed for further cuts. 

The Fed is adding $ liquidity. This is $ negative and EUR/$ volatility has been falling. We expect narrower US-EA growth differentials in 2020 and 2021. EUR may rebound."

On the weekly chart, the trend of EUR/USD is opposite to that of 2011-2014. The 55-week moving average (WMA) at 1.1191 is closely watched. A weekly close above, if seen, would suggest extended gains with the next area of resistance at 1.1360-1.1410, with support at 1.1066.

EUR/USD seen at 1.11 over the next three months while at 1.16 over the next six to 12 months.”