EUR/USD: Sell-off on stock markets put pressures on the Εuro, already falling well below 1.0500

The single European currency began the week under significant pressure as the climate of uncertainty and the sharp losses in international stock markets strengthen the American currency, which, as is known, traditionally functions as a safe haven currency.

The European currency's astonishing performance last week may have little chance of remaining in the spotlight as concern in international markets has returned and the catalysts that were the causes of the European currency's sharp decline in recent months remain on the table.

Geopolitical risks show signs of shrinking, but as long as the Ukrainian front remains open, the possibility of an ''accident'', even if it is smaller, remains on the table.

The interest rate gap is expected to remain in favor of the US currency even if the Fed decides to cut rates by 25 basis points at its next meeting.

While the possibility of political instability in the European Union's two largest economies, Germany and France, along with the sluggish growth of the European economy, remain high on the agenda.

At the same time, the almost first week of Donald Trump's presidency has come to confirm that nothing is certain, as the American president has the ability to use a special rhetoric that often creates confusion in the markets.

The issue of imposing tariffs, although it remains quite high on the agenda, everyone has accepted that the level of confusion regarding the real intentions and what will ultimately prevail is high.

Friday's agenda brought some small signs of optimism for the European currency as some indicators heralding growth for the European economy regarding the services and manufacturing sectors were announced slightly better than estimates.

However, as I mentioned in a previous article, I consider the further strong upward trend of the European currency and its ability to once again approach levels close to 1,08 - 1,10 in the very near future, to be a particularly difficult challenge.

On today's agenda, the IFO index about the prospects of the German economy stands out  , something that always monitor with interest by investors.

I don't see any significant change in the overall market picture with the latest pattern having a good chance of remaining as the base scenario, for the European currency perhaps its not yet time to move to significantly higher levels  and on the other hand  as the exchange rate approaches the critical level of 1/1 the euro may continue to react successfully.

So, the idea to ​buy Euro on dips remains my main thought.