What’s the sentiment around the EUR/USD today? – Commerzbank and Danske Bank

FXStreet (Edinburgh) - The EUR/USD is extending its selling mood on Tuesday, putting the key 1.3100 support to the test ahead of the ECB meeting on Thursday.

“EUR/USD is expected to stabilise around the 1.3105 September 2013 low before reaching the psychological 1.3000 region. On the hourly and daily charts we can see positive divergence which, together with the loss of downside momentum over the past few days, increases the chances of a minor bounce towards the 1.3200 region being seen”, noted Axel Rudolph, Senior Technical Analyst at Commerzbank.

In addition, Thomas Harr, Chief Analyst at Danske Bank, commented,”We expect EUR/USD to fall near term on policy divergence and portfolio flows. Market speculation of further ECB easing will resurface in coming months on very low CPI and weak growth. Meanwhile, we expect the market to move forward its Fed rate hike expectations. Monetary divergence will continue to support the USD”.