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    EUR/USD retains a bearish lilt - Scotiabank Ani Salama

    The EUR’s bounce into month- and quarter-end last week has not driven any significant reassessment of prospects for the single currency, Shaun Osborne Chief FX Strategist while he notes risks remain tilted to the downside .Key Quotes“We still think risks are tilted to the downside for the EUR as the post-Brexit environment will be dominated by concerns about growth and weak inflation, as well as the longer term outlook for the European project itself. Softer European stocks so far today have been driven by weaker banks and financials; concerns about the impact of Brexit on Eurozone banks is another, potentially significant, negative for the EUR in our opinion.““EUR/USD short-term technicals: neutral/bearish—Short-term price action remains consolidative but also retains a bearish lilt. Spot appears to be building a bear wedge/flag on the intraday chart and the market continues to attract decent selling pressure through the mid/upper 1.11 area (the base of the rising channel – now resistance – that supported EUR/USD gains over the past 6 months).”“We look for limited gains for spot in the near-term (1.1160 is resistance) and for more pressure to develop on the downside over H2. Weakness below 1.1096 (200-day MA) should see spot losses extend lower.”

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