02.04 - EUR/USD pair remains at support level 1.09
- by George Solotarov
Investor preference for the US dollar in times of stress still dominated price action on FX markets yesterday. The end of quarter having passed didn't change that pattern. This also applies to the multiple actions of the Fed in cooperation with other central banks to address USD liquidity. The trade-weighted dollar rose, but modestly (close 99.67). The euro underperformed with EUR/USD coming within reach of the 1.09 support (close at 1.0964).
Of late, we assumed the USD liquidity run could slow and that the USD could enter a cautious sell-on-upticks pattern. The trade-weighted USD for now still doesn't contract this view, but the euro underperforms. The EUR/USD 1.09 support area remains our ‘tactical' reference. A break below would make the picture again fragile.