FX Emerging Markets Weekly 10 February 2014 |
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In late January EUR/BRL came within four ticks of the October 2008 peak at 3.3487 before being rejected by it.
Even though a short term reversal lower is still taking place, we will retain our medium term bullish outlook while the currency pair does not close below the January low at 3.1562 on a daily chart basis.
Support above this level can be seen along the 55 day moving average at 3.2301.
If 3.3487 were to be overcome, the minor psychological 3.4000 region and the 2008 high point at 3.4738 will be in targeted.
Were an unexpected daily chart close below 3.1562 to be seen, the 2013-14 support line at 3.1435 would be eyed but should then underpin.
Our short term view has been neutralised for now.
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