EUR/USD: Moves locked in the narrow 1.16-1.20 range – CitiBank

Analysts at Citibank see the EUR/USD pair trading around 1.19 over the next three months and then rising to 1.23 in a six to twelve months period. They see that an economic recovery in the US faster than currently projected by economists is an upside risk to the US dollar. 

Key Quotes:

“At a time where US real yields are rising more than Bund yields, this could lead to investors taking profits on existing longs, keeping spot moves locked in the narrow 1.16-1.20 range held since summer. However, A Biden presidency and loose Fed likely keeps the USD weak versus its major trading partners. We expect the global growth backdrop to materially improve next year and experience less trade friction, EUR positive.”

“EURUSD’s RSI stay at neutral territory. The pair may trade between 1.1603-1.1920 in the short term, with next resistance at 1.2011.”