💶🔻Short EUR/USD, Target At 1.0350 & SL At 1.0875: MUFG

Short EUR/USD trade idea to reflect our view that there is room for the reversal lower to extend further in the near-term. We are expecting the pair to fall back towards support from the 200-day moving average that comes in at around 1.0330. The recent move lower in EUR/USD has been mainly driven by the USD leg.

Stronger US activity data combined with firmer inflation at the start of this year is encouraging market participants to price in a more hawkish outlook for Fed policy. The recent move higher in US yields has been bigger than in the euro-zone.

The euro-zone rate market is pricing in a higher peak for the ECB between 3.50% and 3.75%. Rising euro-zone rates are though having less impact on supporting a stronger EUR. - MUFG Strategy