EUR/USD: Danske Bank continues to expect new annual bottoms in the short term despite yesterday's rebound

In a note published today, Danske Bank reminds us that the EUR/USD was pushed back up after touching the psychological support level at 1.13, but that a break below this threshold is likely in the short term.

"It is important to note that the dollar has progressed recently, without taking into account the movements by equity markets, confirming that the reason for the dollar's good performance is to be found in the United States's economic over-performance.

And even if the EUR/USD was initially rejected by the annual low (1.1301), we maintain our opinion that a break below this threshold remains likely, as the dollar's (bullish) momentum remains significant.

Below 1.13, the next support level will be at 1.120, the peak of 26 July 2017."