The euro is demonstrating to be the surprising beneficiary of the mass sale promoted by trade in risk assets, says Chris Turner, FX analyst of ING.
EUR/USD faces a massive trend resistance in the area of 1.11-1.12
“Normally, the EUR/JPY has a strong positive correlation with risk assets, while this week, the euro has maintained its position. That has nothing to do with a positive reevaluation of the eurozone growth prospects. No, the news there are terrible and could get worse if the EU commercial officials – who will meet Monday in Luxemburg – decide to take reprisals.”
“Remember that only the EU and China commercial blocks have the economic strength to retaliate. Instead, we believe that it is the alternative liquidity offered by the euro. Without a doubt, this is something that those responsible for European policies are eager to explore, and we will be writing on the subject in the coming weeks about what needs to happen so that the euro is a more attractive asset for FX reservations.”
“For the EUR/USD, there is a massive trend resistance in the area of 1.11-1.12, marking its bearish trend from its maximum of 1.60 in 2008. We will probably need to see another great downward movement in US actions to overcome that area in the short term. However, we suspect that buyers will emerge in 1,1020 as doubts continue to grow about a radical change in the preeminent position of the dollar worth.”
Source: Fx Street

I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.