Vasilis Tsaprounis
Independent Analyst
The single European currency maintains a mildly positive tone for the third consecutive day, having moved well away from Monday's low opening, with the 1,04 level being the immediate challenge.
The dust from announcement of weekend tariffs by President Trump has slowly subsided, but we have now entered an environment where surprises and confusing behaviors by President Trump are now a daily occurrence.
The course of the exchange rate, beyond the broader macroeconomic picture of the eurozone and the United States, is expected to be significantly influenced by President Trump's rhetoric and his actions.
We are currently in a foggy environment regarding the final decisions on whether or not to impose tariffs, the final percentage, and the total number of countries on which they will be imposed.
So it makes sense for investors to remain cautious and avoid big bets, and although the US currency has many reasons to maintain an upward rally, this has not in the last days, with the European currency showing good resilience.
The pair's behavior in recent days once again confirmed my thoughts and desire to buy the European currency after a sharp dip, although I failed to find the right entry point.
Fed Chairman Powell, in his first statements before Congress yesterday, did not provide any major surprises, with bets currently remaining in favor of the possibility that the Fed will not make a policy change at its next meeting.
The overall market picture does not show significant differences and the pattern of recent weeks has a good chance of remaining in the spotlight. The European currency, apart from some good reactions, having difficulty developing a strong upward momentum and the return to levels close to 1,08 in the near future remains a very difficult challenge, while on the other hand, the approach close to the levels of 1/1 is likely to continue to provide opportunities for long positions in favor the European currency.
Today's agenda is quite interesting with the announcement of the consumer price inflation index in the United States and the second day of Fed Chairman Powell's speech before Congress.
I remain in the thought and desire to buy the European currency on some new sharp dip well below the recent lows of 1,0175.
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