Questions about whether or not the euro will make a run at 1.50 are in focus today on the currency market. The forex trading forecast for the euro is dependent, in large part, on the risk trade, and the risk trade seems to be gathering steam right now.
Indeed, as forex traders abandon the U.S. dollar for higher returns, the euro is gaining in forex trading. However, calls for a run at 1.50 may be premature. The risk trade could fall apart fairly easily, GFT's Boris Schlossberg points out in FX360:
Today’s key North American event risk will be the ISM Manufacturing survey. Markets forecast a rise to 53.1 from 52.6 the month earlier, and given the sharp increase in Chicago PMI data on Friday an upside surprise could be in order. However, the employment subcomponent will likely be as key as the headline number, and if does not confirm an improvement in labor conditions, the rebound in risk FX could quickly run out of steam.