EUR/USD: Euro on hold, new pressures may still in game
|The European common currency holds levels near 0.9800 as it shows strong signs of stabilization after last week's intense volatility .
The pair has returned about 300 basis points from the lows of 0.9535 and is showing signs of consolidation looking for direction again .
As we mentioned in a previous article, the pair continues to trade within a descending channel that started in May 2021 from the 1.22 level .
The last decline to 0.950 levels confirmed the lowest end of this channel and currently the bullish limit appears near the 1,01 .
So with the exchange rate being right now in the middle of this channel the chances of the pair moving in one or the other direction are relatively divided .
The mixed picture from a technical point of view is also reinforced by the macroeconomic data which, although they continue to weigh on the common European currency, as we aptly noted last week, to a large extent have already begun to be '' digested '' by the markets .
Also today is characterized by National Holidays in some markets such as those of Australia and Germany which is likely to limit trading volume so the prospect of limited trading range is quite possible .
We are not expect any major surprises today and a possible retracement of the pair near to levels 1/1 would surprise us in terms of the time horizon this will achieved .
As , even if we are stick to the long-term view that the exchange rate will return to level 1/1 and well above that , perhaps the prospects for new pressures on the European currency and a return to the low levels again remains in play .
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