Amid Italian political turmoil, trade tensions and uncertainties over the European Central Bank’s (ECB) monetary policy outlook, the TD Securities (TDS) analysts believe that the upside attempts in the shared currency are likely to get sold-into.

“Italy has resurfaced in the past few sessions with Salvini calling for fresh elections. Positioning has clouded the impact on the EUR, with the bulk of our positioning proxies showing it has the most extreme short in the G10. Still, lingering growth concerns and the uncertainties about whether more ECB easing will triggers Trump's tariff button are a few reasons to think that EUR rallies look contained here.”