Vasilis Tsaprounis
Independent Analyst
The single European currency is in a soft recovery environment having already secured the level of 1.0750 in the wake of the French elections where the far right came out strengthened but so far the future of the eurozone does not inspire concern.
Investors did not see the result as a game changer and the mild recovery of the European currency is still too early to be considered a change in momentum.
After the short break and fixation on the election results, markets are expected to return to the main catalyst affecting the exchange rate of late which is none other than the prospects for a cut in key rates by Fed and ECB.
For now there is no major change in the bets with the odds remaining for two more cuts from the ECB and possibly one cut towards the end of the year from the Fed.
On today's agenda, the announcement on the course of inflation in the German economy stands out, as well as the speeches of President Lagarde.
I have some doubts as to whether the mild dynamics of the euro can last long as it may still be early to see a reversal of the trend and a return of the euro to the levels of 1,10.
The interest rate differential in favor of the US currency remains on the table with the possibility that it will widen be quite high, which acts as the main weight in the European currency's attempt to develop strong upward momentum.
There is no change in my thinking, I remain on hold waiting for levels near 1,06 or below to position myself in favor of the Euro.
Note: All information on this page is subject to change. The use of this website constitutes acceptance of our user agreement. Please read our privacy policy and legal disclaimer. Opinions expressed at FXstreet.com are those of the individual authors and do not necessarily represent the opinion of FXstreet.com or its management. Risk Disclosure: Trading foreign exchange on margin carries a high level of risk, and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to invest in foreign exchange you should carefully consider your investment objectives, level of experience, and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with foreign exchange trading, and seek advice from an independent financial advisor if you have any doubts.
Recommended Content
Editors’ Picks
EUR/USD stays firm above 1.0750, awaits German inflation data
EUR/USD holds gains above 1.0750 in European trading on Monday. The Euro capitalizes on France's far-right National Rally (RN) party win in the first round of elections while the US Dollar stays offered on renewed Fed rate cut bets. The focus stays on German inflation and US PMIs.
GBP/USD consolidates gains below 1.2700, as US PMIs loom
GBP/USD consolidates the upside below 1.2700 in the European session on Monday. The US Dollar remains weighed down by dovish Fed expectations and the EUR/USD upsurge, keeping the pair supported ahead of the US ISM PMI data.
Gold price struggles for a firm intraday direction ahead of US PMI data
Gold price oscillates in a narrow trading band on Monday amid mixed fundamental cues. Rising bets for a September Fed rate cut weigh on the USD and lend support to the metal.
Bitcoin is breaking above the falling wedge
Bitcoin breaking above the falling wedge pattern on Monday signals a bullish move, with Ethereum and Ripple poised to follow as they find support at key levels, paving the way for an upside rally in the days ahead.
Significant month for US stock markets and currencies
This month sees important time cycles across a range of instruments suggesting that we are at a major pivot point. In this video we look at the significant turning point coming out very shortly on the S&P 500 that will also impact the other US indices.