Euro (EUR) price action reflects the firmer tone in the USD overall as well as some re-widening in EZ/US short-term spreads, Scotiabank’s Chief FX Strategist Shaun Osborne notes.

EUR drops to 1.05

“Fair value has slipped a little to 1.0499 today, suggesting the EUR is trading about where it should be, based on short-term factors.”

“A fourth day of losses in the EUR is starting to see a shift in short-term trend momentum back in the USD’s favour—to align with EUR-bearish signals on the daily and weekly DMI oscillators. EURUSD is pressuring supports in the upper 1.04s and risks easing further to 1.0430/60 range in the short run. Resistance is 1.0530.”