EUR/USD: Euro remains ''heavy'' near 1.0500 level ahead of a rich agenda in the next three days

Vasilis Tsaprounis Independent Analyst

The single European currency remains in a narrow trading range near 1.05 levels with investors avoiding big bets in view of a rich agenda over the next three days, culminating in jobs data to be announced in US on Friday's noon.

The first days of the week was without any surprises, with the European currency remaining in a defensive mode unable to develop any strong upward momentum, with some good reactions being all the best it has managed so far.

But at tyhe same time the European currency has avoided further losses and remains well away from the recent lows of 1.0330, confirming my thought that the recent rally in the US dollar has shown significant signs of fatigue. But as some catalysts that act as ''weights'' on European currency remains in play, any reaction so far is limited.

Political instability in two of the eurozone's major economies, France and Germany, combined with concerns about the course of the European economy and the maintenance of geopolitical risk at high levels, continue to keep the US currency in the spotlight with the possibility of a new dynamic to remains high.

At the same time, the prospects of interest rate cuts by the Fed and ECB remain high on investors' agendas, with the landscape being relatively more cloudy regarding the Fed's moves, as the probability of a new interest rate cut by the end of the year is just over 50%.

Today's agenda is quite rich with a multitude of economic announcements as well as statements by officials, mainly from the Fed, with those of Chairman Jerome Powell and ECB's President Christine Lagarde standing out.

The limited range of fluctuation that was characteristic of yesterday will likely not be maintained today as developments in the political environment in the European Union as well the rich agenda with news and statements are expected to ''shake'' the markets and volatility to increase.

There are no changes in my thoughts, I remain in a wait-and-see position, maintaining the idea of buying the European currency on some sharp fresh dips near the recent lows of 1.0330.

Author

Vasilis Tsaprounis

Independent Analyst

Vassilis Tsaprounis possesses over 25 years of professional experience in Capital Markets and especially in the foreign exchange market.

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