TD FX Strategy Research discusses its EUR/USD and USD/JPY outlook and trading strategies in the near to medium term.
EUR/USD: "The EUR stumbled at the start the week, seemingly on the injection of new political risk in Germany....For now, we think Merkel will try to cobble together a governing coalition and the EUR will remain a growth currency in the G10. This should offer some insulation from political risks, leaving us happy to buy on dips around 1.17," TD argues.
USD/JPY: "The JPY has been one of the notable outperformers over the past week, rallying 0.9% against the USD...We remain short* and think longer-term valuation and the inability of the BoJ to weaken an already extremely undervalued currency is one," TD advises.
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