Towards the all important ECB decision, what are big investors looking at for EUR/USD:
The team team SocGen explains:
Here is their view, courtesy of eFXnews:
SocGen is out with the results of a survey for a fairly even composition of their clients (corporates, hedge funds, etc) with regarding to mainly their expectations for the ECB move this week, and their current EUR/USD trading strategies. The following are a selection of some of the key results from this survey:
– Our survey found that almost 70% of investors expect ECB Sovereign QE in January. A smaller group expects it later or additional waves of Sovereign QE. Only a small minority does not believe in Sovereign QE.
– The bulk of the market expects a program of 500bn but the distribution is quite right skewed with another peak at 1000bn. A significant minority expects the ECB to cut its main refinancing rate in January or in the following months.
– Over 60% are sellers of EUR/USD on rallies with only a tiny minority is doing the reverse. On the whole investors target 1.10 as the peak target and expect the ECB is doing the same, another substantial group bets on parity and believes the ECB is doing the same.
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