Quotes from BofA Merrill Lynch:
- With US yields poised to rise further, we remain bearish much of EM FX. TRY, BRL, ZAR, and COP are all particularly vulnerable.
- Of these three, USD/TRY is particularly exposed following its push to new all time highs, with upside targets seen to 2.6008 ahead of 2.6597 and potentially beyond.
- Looking at USD/BRL, the failure to extend lower following Friday's Bearish Engulfing Candle speaks to the strength of the larger bull trend. Indeed, a break above 2.9203 would confirm the pattern failure; clearing the way for 3.0572/3.1164.
- USD/ZAR continues its stair step higher with medium term targets seen to 12.5020 and potentially beyond.
- Finally, USD/COP has broken 9yr trendline resistance (now 2539) clearing the way for the confluence of long term resistance and measured moves between 2627/2718.
