EUR/USD: Euro is on fire, it is ready to challenge the 1.0700-1.0800 critical levels

The single European currency maintains a strong upward momentum and is on the threshold of the critical level 1,07 as since the beginning of the week, President Donald Trump's ΄΄tariffs dance΄΄ has currently burdened the American currency.

President Trump's aggressive rhetoric and controversial moves find a response and we are now on the verge of a fairly tough trade war.

The hitherto prevailing view that imposing tariffs is the way to increase inflation only in US is now being questioned, since the generalization of the phenomenon and the imposition of retaliatory tariffs between important trading partners creates the possibility that inflationary pressures will return to the European Union as well.

At the same time, as I mentioned in yesterday's article, the exchange rate had remained for a long time in a controlled fluctuation range, which had made it quite predictable, with the result that several stop-loss orders have now been activated.

The European currency found the opportunity to approach the critical levels of 1,07 - 1,08, but in my opinion, the main catalysts that had burdened it in recent months have not been removed from the table, consequently the further rise , the breakdown of the 1,08 level and stay above it constitutes a significant challenge and perhaps a big surprise.

Today's agenda is quite rich with several important macroeconomic news being announced with indicators for the course of the manufacturing and services sectors in Europe and the United States standing out.

The sharp rise of the European currency in the last three days has surprised many as most analysts were in favor of the American currency, targeting levels close to 1/1, and the distance from this target is forcing several "players" to close their positions, which gave an additional boost to the euro.

As I mentioned in previous articles, the goal I had set to buy the US currency is approaching and although the rise is quite steep, I will remain in my view and position myself in favor of the US currency between  1,07 - 1,08 levels.