Nimbus clouds are appearing on the monetary side across the globe, whilst Europe starts to clear risks in a similar nature to that of 2017. There is an underlying bid for the EUR, appreciation pressure remains in what is becoming a "race to the bottom" for G10 FX. Inflation swap markets are screaming for attention from the ECB ahead of the important CB combo next month.
With a continued unwind of EUR funded carry trades, the EUR is going to receive a near-term support with risk-off weighing on EM. Sharks are smelling a major change in trend, the titanic is finally turning.
Risks to this trade come from Europe & US trade tensions rising (unexpected).
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The effects of ECB unconventional policy
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The test of 1.10xx looks likely before reversal formation...we covered this in the previous idea