EUR/USD: 1.1000 is done, what's next?

The single European currency retreats slightly below the 1,10 levels in the early morning hours of Wednesday after earlier achieving the upside breakdown of the crucial psychological level.

Finally after several days in which the pair was trapped in a limited range of fluctuation near the levels of 1,09 -1,0950  yesterday fed a  new mild upward momentum for the European currency which managed to reach the level of 1,10 but without for now be able to secure it with great ease.

Yesterday's statements by officials from the two main central banks acted as the main catalyst for the mild rise of the European currency, as from the Fed's point of view, everything now shows that the cycle of interest rates has closed for good, while there are already bets on the table that the first reduction of interest rates It may start a little earlier than previously expected.

At the same time, on the part of the European Central Bank, they maintain, albeit in a fairly conservative way, the possibility that if the reduction of inflationary pressures does not develop as expected, another increase in key interest rates has not been completely removed from the agenda.

The behavior of the market confirmed my thinking as mentioned in previous articles as the 1, 10 although not an easy task was a realistic target for the exchange rate which has just been achieved.

Today's agenda is quite rich with important announcements such as the inflation path in Germany and the growth path of the US economy.

Now I have significant doubts about the further rise of the European currency. However, the possibility is not small if the inflationary pressures in the eurozone show signs of resistance we will see the exchange rate even higher.

However, I will not stay far from my thought of preferring to buy the American currency at prices well above the 1.10 levels as I estimate that the rise of the European currency will soon show new signs of fatigue.