EUR/USD is never too far from the 1.12 level, trading a bit above or a bit below this level. What’s next? The team at Nordea leans to the dovish side:

Here is their view, courtesy of eFXnews:

Nordea FX Strategy Research recommends staying short-term bearish EUR/USD on the ground of the following 6 reasons:

“1) The pair still looks lofty vs rate and yield spreads.

2) Unhedged equity inflows will become less supportive in the wake of stronger US data or somewhat weaker EA data.

3) US data usually starts to improve by summer.

4) IMM FI positioning suggests risks for higher yields in coming months.

5) Any downside in US rates (or 10y yields) should be limited given a market pricing only one hike in 2018 (FFF9 vs FFF8).

6) Tax cut expectations have been paired down significantly, what if the US administration actually delivers something?,” Nordea argues.

EUR/USD is trading circa 1.1195 as of writing.