EUR/USD: Will Lagarde and US GDP be able to put new bets on the game?

Vasilis Tsaprounis Independent Analyst

The single European currency remains close to the level of 1,09 awaiting the meeting of the European Central Bank, the speech of the President Cristine Lagarde and the announcement on the growth rate of the United States.

The continuation of the day is awaited with great interest as the news is stormy and the degree of severity with a possible significant distance from estimates could act as a trigger for strong volatility in the exchange rate.

Regarding the maintenance of the monetary policy at the same levels this is a given and there is no possibility for something different, consequently, all the interest is focused on the statements of the President Lagarde regarding the prospects of the European economy, the course of inflation and a possible time horizon where the European Central Bank will change monetary policy.

Bets are currently concentrated on the possibility that the ECB will go ahead with its first rate cut sometime in the summer.

Yesterday was quite interesting and broadly confirmed my thoughts as expressed in yesterday's article as although the European currency had a mild upward momentum this soon weakened and the exchange rate once again fell back below the 1.09 level.

The trading of the exchange rate on either side of the level of 1.09 with some good discrepancies confirms the characterization that the pair is quite "heavy" at this levels, it is particularly difficult to find any strong direction and is waiting for the trigger which could change the bets.

Although the European currency is showing strong resistance and has managed to limit further losses by showing signs of a very good reaction the possibility of the 1.08 level being set again as a challenge I believe has not gone away.

In any case, staying on hold in the face of stormy news and announcements is probably the best idea.

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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