EUR/USD: Euro remains under mild pressure near 1.0850 level with room for further losses
|The single European currency is heading for a third consecutive day of mild losses as levels well above 1.09 level have so far accepted a difficult case.
The developments of the last few days have partly confirmed my thoughts as expressed in previous articles, as I had significant doubts about the ability of the European currency to continue its strong momentum without at least a good correction.
In any case, with levels just above 1.08, the recent correction of just over 100 basis points from Tuesday's high of 1.0947 cannot be considered to have moved far enough from the peaks and the space for further correction remains open.
The developments that investors are watching remain hot, with geopolitical developments and President Trump's " tariffs dance" remaining high on the agenda.
The latest news from the Ukrainian front create a moderate optimism as there is an effort for a temporary ceasefire and the start of negotiations, but I would maintain quite conservative thinking as unfortunately, there are still significant thorns in this perspective.
At the same time, the landscape remains quite murky regarding the real impact of the trade war between the United States and key partners, as the mix between inflationary pressures and the impact on growth is a huge question mark.
In such a cloudy environment, the possibility that the exchange rate will start to ''weight'' in not small.
The pressures on the American stock markets continue, but for now the US dollar, which has traditionally functioned as a safe haven currency, has not benefited.
Today's agenda included the course of inflation in the German economy, which, without giving any major surprises, showed some very mild signs of containment, while later in the afternoon the University of Michigan's index on consumer sentiment in US stands out on the agenda.
I will maintain my position in favor of the American currency at the 1,08 levels from last week. The signs of fatigue in the European currency have indeed appeared on the table, but unfortunately, so far the correction is very limited, which leads me to think about exiting the position in favor of the US dollar relatively soon without gaining any big profit.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.