The USD should remain under pressure until late Q3, perhaps even Spring 2021.
- The EUR/USD may have plugged a secular low in March on our long term bi-monthly graph. The configuration suggests a continuation of the current bounce into early next year.
- Shorter term, we expect further upside into end of month/early October, possibly up to 1.22, followed by a correction in mid/late Q4, and then a further leg up into next Spring, potentially to the high 1.20s.
Similar dynamics for other anti-USD trades like Commodities or Emerging Markets:
Copper: possibly a secular bottom too this Spring. We expect more upside into late Q3, some retracement during the Fall and then a new leg up into Spring 2021.
Emerging Markets (MSCI EM Index): should follow same pattern, potentially to new all-time highs Spring 2021.
Commodity Currencies: their strong reversal continues. Same pattern.
Conclusion: the huge fiscal and monetary programs, which have been implemented since March are probably game-changers for the USD and related trades