EUR/USD: The slippage continues, 1/1 is simply a matter of time?

Vasilis Tsaprounis Independent Analyst

European common currency traded below the 1.01 level on the last day of the week, sliding around 200 basis points during it.

The slightly bearish momentum has been maintained throughout the week and although there have been significant corrections the European currency is in worse position and is preparing to defend the level of 1/1.

The main data acting as a weighting for the European currency remain and do not appear to change in the very near future.

The difference in interest rates between the two central banks, the prospect of maintaining this difference and the worst position the European economy has been in because of the Ukraine War remain the main causes for pressures on the European currency.

As it is at the moment the main picture of the fundamental macroeconomic quantities, but also of the geopolitical situation these data will remain in the foreground for some time yet.

Nevertheless, as it was shown by the announcement of the data on the course of inflation in USA the previous week that worked as a trigger to decompress the exchange rate, any announcement or development that differs even slightly from the aforementioned will be capable of leading the euro to a significant correction.

For this reason we maintain our latest basic strategy of buying the Euro at new market dips.

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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