EURUSD narrow trading range remains on table, as investors shun large bets.
The single European currency EURUSD is moving slightly higher, having temporarily secured the level of 1,0850, but without breaking away from the extremely confined range of movement over the previous few days.
Investors are cautious and avoid placing large wagers because the EURUSD currency rate remains ”heavy” and new strong evidence is required for it to move in a specific direction.
The broad picture of the market remains unchanged. With the prospect of a shift in monetary policy from the two main Central Banks. Which continue to monopolize interest and are one of the primary factors influencing the exchange rate for the time being.
Yesterday, President Lagarde simply confirmed The explanation that has recently been put up is that while inflationary pressures are diminishing, there is still a long way to go before reaching the 2% target.
At the moment, most bets are on both Central Banks making their first key interest rate cuts in June.
US currency had been in the spotlight a few weeks before, with President Powell’s tough speech.
The US currency had been in the spotlight a few weeks before. With Fed President Powell’s tough speech and rising inflation rates acting as a catalyst. Causing the dollar to temporarily break the level of 1,07.
Since that time, and for ten straight days, the dust has cleared. The American currency has not been able to maintain its upward trend; as a result The EURUSD has reacted nicely and it It has regained more than 150-200 basis points, with a slight upward trend. Nonetheless, I believe that this movement cannot be defined as a strength of the European currency. The market has just balanced out, and investors appear to be waiting for the next stimulus that will produce a strong direction.
The sole item on today’s agenda that stands out is US Durable Goods Orders. And any large divergence from projections may cause exchange rate volatility.
I stay on hold as I find it difficult to see any direction at the specific levels. But without veering from my core notion of buying the European currency following a significant dip.
