MUFG Research sees a scope for EUR/USD to decline further on further built in short positioning.
"The German authorities have incredibly done a complete 360 after previously advising against taking the Astra Zeneca vaccine for those over the age of 60 to yesterday announcing new guidance that the AZ vaccine should not be taken by those under the age of 60!..How the German announcement impacts supply and take-up will only be known over the coming days and weeks but for now it is highly likely that investors will assume this will negatively impact vaccination roll-out," MUFG notes.
"EUR/USD is now testing the 1.1700 level and is extending further below the 200-day MAV that was breached last week. Leveraged Funds turned net sellers of EUR two weeks ago but the extent of shorts is very modest with ample scope for this short to be built further. That seems the most plausible short-term scenario from here," MUFG adds.