The euro bounced after the French election but remains heavy near 1.09. Economists at BBH note that the EUR/USD pair may test the March 7 low near 1.0805.

Run-off will be held between Macron and Le Pen

“Macron got 28% of the vote vs. 24% for Le Pen in the first round. One early poll shows Macron winning 54-46% in the second round, while another one is a lot closer at 51-49%. We warn of the so-called Bradley effect, which suggests that the polls will likely understate Le Pen’s support. If polls tighten up ahead of the runoff, we expect markets to become more jittery.”

“A break above 1.1050 is needed to signal a deeper correction towards the March 31 high near 1.1185.” 

“A test of the March 7 low near 1.0805 is still in the cards.”