Some small signs of reaction for the single European currency just above the level 1,04 after yesterday's fall.
Yesterday was marked by a further drop of 100 basis points as those who expected President Lagarde to give some messages of optimism during the conference in Portugal were disappointed.
As we noted on Tuesday, it would be difficult for the ECB President to say something that would be able to create a strong upward momentum for the euro.
So the gap created between FED and ECB policy remains and temporarily favors the US currency.
Yields on 10-year US government bonds remain satisfactory to attract buyers . While the new pressures on the stock markets increase the climate of risk aversion and strengthen the dollar as a safe haven currency.
Now the chances of the pair re-approaching the lows at 1,0350 are increasing, this time the probability that the level will broke downwards is increased.
But on the other hand let us not forget that the levels are already quite low and prices close to the level of 1/1 or below will not be at all desirable by the Eurozone officials.
In such environment we would prefer '' buy on new dips '' strategies for the pair.
𝘛𝘩𝘦 𝘤𝘰𝘯𝘵𝘦𝘯𝘵 𝘱𝘳𝘰𝘷𝘪𝘥𝘦𝘥 𝘪𝘯 𝘵𝘩𝘪𝘴 𝘮𝘢𝘵𝘦𝘳𝘪𝘢𝘭 𝘢𝘯𝘥/𝘰𝘳 𝘢𝘯𝘺 𝘰𝘵𝘩𝘦𝘳 𝘮𝘢𝘵𝘦𝘳𝘪𝘢𝘭 𝘵𝘩𝘢𝘵 𝘵𝘩𝘪𝘴 𝘤𝘰𝘯𝘵𝘦𝘯𝘵 𝘪𝘴 𝘳𝘦𝘧𝘦𝘳𝘳𝘦𝘥 𝘵𝘰, 𝘸𝘩𝘦𝘵𝘩𝘦𝘳 𝘪𝘵 𝘤𝘰𝘮𝘦𝘴 𝘧𝘳𝘰𝘮 𝘢 𝘵𝘩𝘪𝘳𝘥 𝘱𝘢𝘳𝘵𝘺 𝘰𝘳 𝘯𝘰𝘵, 𝘪𝘴 𝘧𝘰𝘳 𝘪𝘯𝘧𝘰𝘳𝘮𝘢𝘵𝘪𝘰𝘯 𝘱𝘶𝘳𝘱𝘰𝘴𝘦𝘴 𝘰𝘯𝘭𝘺 𝘢𝘯𝘥 𝘴𝘩𝘢𝘭𝘭 𝘯𝘰𝘵 𝘣𝘦 𝘤𝘰𝘯𝘴𝘪𝘥𝘦𝘳𝘦𝘥 𝘢𝘴 𝘢 𝘳𝘦𝘤𝘰𝘮𝘮𝘦𝘯𝘥𝘢𝘵𝘪𝘰𝘯 𝘢𝘯𝘥/𝘰𝘳 𝘪𝘯𝘷𝘦𝘴𝘵𝘮𝘦𝘯𝘵 𝘢𝘥𝘷𝘪𝘤𝘦 𝘢𝘯𝘥/𝘰𝘳 𝘪𝘯𝘷𝘦𝘴𝘵𝘮𝘦𝘯𝘵 𝘳𝘦𝘴𝘦𝘢𝘳𝘤𝘩 𝘢𝘯𝘥/𝘰𝘳 𝘴𝘶𝘨𝘨𝘦𝘴𝘵𝘪𝘰𝘯𝘴 𝘧𝘰𝘳 𝘱𝘦𝘳𝘧𝘰𝘳𝘮𝘪𝘯𝘨 𝘢𝘯𝘺 𝘢𝘤𝘵𝘪𝘰𝘯𝘴 𝘸𝘪𝘵𝘩 𝘧𝘪𝘯𝘢𝘯𝘤𝘪𝘢𝘭 𝘱𝘳𝘰𝘥𝘶𝘤𝘵𝘴 𝘰𝘳 𝘪𝘯𝘴𝘵𝘳𝘶𝘮𝘦𝘯𝘵𝘴; 𝘰𝘳 𝘵𝘰 𝘱𝘢𝘳𝘵𝘪𝘤𝘪𝘱𝘢𝘵𝘦 𝘪𝘯 𝘢𝘯𝘺 𝘱𝘢𝘳𝘵𝘪𝘤𝘶𝘭𝘢𝘳 𝘵𝘳𝘢𝘥𝘪𝘯𝘨 𝘴𝘵𝘳𝘢𝘵𝘦𝘨𝘺. 𝘗𝘢𝘴𝘵 𝘱𝘦𝘳𝘧𝘰𝘳𝘮𝘢𝘯𝘤𝘦 𝘥𝘰𝘦𝘴 𝘯𝘰𝘵 𝘤𝘰𝘯𝘴𝘵𝘪𝘵𝘶𝘵𝘦 𝘢 𝘳𝘦𝘭𝘪𝘢𝘣𝘭𝘦 𝘪𝘯𝘥𝘪𝘤𝘢𝘵𝘰𝘳 𝘰𝘧 𝘧𝘶𝘵𝘶𝘳𝘦 𝘳𝘦𝘴𝘶𝘭𝘵𝘴.