EUR/USD: 1.10 lost and eyes 1hr 100 SMA

By FXStreet FXStreet (Guatemala) – EUR/USD is currently consolidating the upside and losing steam on the 1.09 handle as we approach the end of the week, with little in the way to upset the idea of a Fed hike next week.

That said, there is no certainty around the Fed and if the ECB was anything to go by, a shock to the market would expose the downside in the greenback while bets are already placed on further upside in the euro as Yellen will likely hold off on increasing rates further in the short -term, and even if so, incrementally and shallow hikes have been on the cards.

A 25bp’s hike is expected to kick us off albeit mostly already priced in. However, looking further out, in the US, Padhraic Garvey, analyst at ING suggested to remember that the Fed dots still sit well above the funds strip, “Which leaves plenty of room for the market to revise upward rate hike expectations should US robustness flow well into the business end of 2016.”

Ket Juckes, economist at Socgen explained also that the post-hike dollar correction has started early. ” Positioning is being adjusted so that we may not see …read more

Source:: FX Street