CIBC strategists suggest selling the euro on
rallies over $1.2700, with a downside target of $1.1650 (before year
end) and a stop at $1.30. The euro has tested and rejected trend
resistance as well as its 21-day moving average ($1.2825) over the past
24 hours, they say. "While price action remains extremely volatile, the
overall direction is clear; prices are heading lower," the strategists
say. Fundamentals are also euro negative. The ECB has cut rates by 50
bps, but the EU two-year bond yields holds 100bps below the ECB target
rate, "a sign that there is much rate cutting left to do," they say.