Euro's upward momentum seen limited: strategists ( EURUSD ) (by Sue Chang)
SAN FRANCISCO (MarketWatch) -- The euro's strength on Wednesday on the back of Federal Reserve Chairman Ben Bernanke's comments suggesting the possibility of further stimulus measures is likely to be short lived, currency strategists said. The euro (eurusd) rose to $1.416 in recent trade from $1.407 before Bernanke's speech. "The euro has benefited strongly from Bernanke, but that won't last as European news will soon trump the Fed in dictating price action for all euro currency pairs," wrote Alan Ruskin, global head of G-10 FX strategy at Deutsche Bank, in his note. Kathy Lien, director of global research at GFT, also believes that Europe's debt woes will catch up with the euro again, capping the currency's upside. "With the IMF talking about the possibility of a selective default by Greece and reports trickling out about different European banks failing the stress tests, the gains in the EUR/USD will probably be limited," she said in emailed comments to MarketWatch. Lien expects profit-taking on long euro-dollar positions to emerge later this week.