Societe Generale Research discusses the EUR outlook and highlights the importance of the release of the eurozone April flash PMI on Thursday for EUR/USD direction this week.
"Chinese and Eurozone data on Friday put the squeeze on euro shorts. How far this move goes may depend on whether see an upside surprise from Eurozone PMIs on Thursday. We expect an above-consensus jump to 52.3 in the flash April PMI when the data are released on Thursday. If that helps drag the Bund yield a bit higher the euro will surely follow it, as it has done for the last year," SocGen notes.
"EUR/USD 1.1315 is this morning's challenge, and 1.1450 may be a rather bigger obstacle, to be tested of we do indeed see better PMIs. There isn't a lot ahead of those, but ZEW tomorrow and new car registration data on Wednesday are potential movers, or party-poopers," SocGen adds.