BofA Merrill stopped out of euro short

Views on gold and the euro from BofA ML

Bank of America Merrill Lynch exited its EUR/USD short position today on the push above 1.1062 resistance.

"This move invalidates our near term bearish view and points to a much larger choppy environment than previously expected. Indeed, we can't rule out a re-test of the May-15 high at 1.1468," BofA argues.

"Bigger picture, we remain bearish for 1.0283/1.0000, but how it gets there from here, we can't be certain," BofA adds.

Turning to gold, BofA has tempered its enthusiasm on the yellow metal.

"The range trade from last November looks increasingly like a potential Triangle, which would limit the potential upside," BofA projects.

"In the near term, gain should be limited to the May-18 high at 1231, while the confluence of retracement support at 1177/1172 should limit the downside," BofA adds.

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