Scotiabank’s strategists Shaun Osborne and Eric Theoret note the Euro is extending consolidation around 1.17 after sentiment-driven gains linked to easing geopolitical concerns. They highlight constructive risk reversals, supportive yield spreads and reduced demand for downside protection. Short-term technicals are bullish, with RSI firmly above 50, limited resistance ahead of 1.18, and an expected near-term range between 1.1680 and 1.1780.

Euro holds gains as technicals turn bullish

"The EUR is extending Thursday’s consolidation and entering Friday’s NA session with a fractional 0.1% gain vs. the USD. The latest congestion appears to be centered around 1.17, and follows a sentiment-driven recovery motivated by the tentative easing in geopolitical concerns."

"The recovery in risk reversals is constructive and suggests a continued softening in demand for protection against EUR weakness, allowing for a return to fundamentals."

"Yield spreads are supportive and offer near-term upside risk for the EUR."

"Bullish – the RSI is firmly in bullish territory above 50, revealing an impressive recovery in momentum following a mid-March plunge to oversold levels nearing 20."

"We see limited resistance ahead of 1.18, a level that offered considerable congestion through the latter half of February."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)