EUR extends tight consolidation around 1.08 – Scotiabank

Euro (EUR) is extending its tight consolidation around 1.08 ahead of Wednesday’s US tariff announcement, Scotiabank's Chief FX Strategist Shaun Osborne notes.  

The 1.08 level remains a magnet for near-term congestion

"Near-term price action is expected to be driven by sentiment, given the absence of any high-level data releases. Fundamentally, yield spreads offer little in terms of direction as they have traded sideways over the past two weeks or so." 

"Comments from ECB President Lagarde have been supportive, endorsing policymakers’ recent shift toward a pause. Markets are still pricing nearly 20bpts of easing for the April 17 meeting and a fade in expectations for cuts should offer EUR support."

"The 1.08 level remains a magnet for near-term congestion as we note recent support in the mid-1.07s and resistance around 1.0850. The RSI continues to soften and is hovering just above the neutral level at 50. The broader, one month range is bound between support in the low 1.07 area and the mid-1.09s."