Jump to content

Euro Price Latest – EUR/USD Slumps to 1.1000, EUR/GBP Hits a Near Six-Year Low


Recommended Posts

EUR/USD Price, Chart, and Analysis

  • EUR/USD continues to slide, will 1.1000 bring any relief?
  • US Job reports will act as the next, short-term driver.

Euro | Dollar: Euro falls to lowest since 2016 vs sterling, Aussie dollar  shines

The Euro is unable to buy a break at the moment with the single currency under pressure from a host of other major currencies. EUR/USD is now 1.1000, a low last seen in May 2020, while the Euro printed its lowest level against Sterling (0.8260) since July 2016. The Federal Reserve and the Bank of England are both hiking interest rates and looking to withdraw pandemic liquidity from their markets, the ECB is stuck and unlikely to raise interest rates until early 2023. The underlying shift in rate hike expectations over the past few weeks has weighed heavily on EUR/USD and EUR/GBP and will continue to do so in the months ahead.

 

The war in Eastern Europe is also pressing down on the Euro with Germany’s heavy dependence on Russian oil and gas seen as a negative for Europe’s largest economy. With energy prices sky-high, there are growing fears that the German economy may stall, bringing into doubt the ECB’s plan of reducing the zone’s dependence on quantitative easing. Inflation is also rife in Europe - as it is globally - and with slowing growth and rising inflation, the ECB needs to tread very carefully when looking to temper price pressures within the single block. Next Thursday’s ECB monetary policy meeting will be an event to follow closely.

Today’s US Jobs Report (NFP) will need to be followed, although its overall effect on the market is weakening due to the path of future US interest rate hikes being fairly well signposted. The US jobs market is tight and is expected to remain so for the immediate future.

For all market-moving data releases and events, see the DailyFX Economic Calendar

EUR/USD is pressing down on 1.1000, a psychological level more than a pure technical level, and a confirmed break below here opens up the potential for a longer-term move all the way back down to the pre-pandemic double low at 1.0636.

Lessons For Becoming a Better Trader

EUR/USD DAILY PRICE CHART – MARCH 4, 2022

Euro Price Latest – EUR/USD Slumps to 1.1000, EUR/GBP Hits a Near Six-Year Low

Retail trader data shows 68.93% of traders are net-long with the ratio of traders long to short at 2.22 to 1. The number of traders net-long is 2.65% higher than yesterday and 20.93% higher from last week, while the number of traders net-short is 8.82% lower than yesterday and 12.06% lower from last week.

We typically take a contrarian view to crowd sentiment, and the fact traders are net-long suggests EUR/USD prices may continue to fall. Traders are further net-long than yesterday and last week, and the combination of current sentiment and recent changes gives us a stronger EUR/USD-bearish contrarian trading bias.

What is your view on the EURO – bullish or bearish?

 

Mar 4, 2022 |  Nick Cawley, Strategist. DailyFX

Link to comment

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
  • Posts

    • Sainsburys full year earnings and Unilever’s first quarter trading update both say the same thing, UK consumers are in for higher prices. The war in Ukraine, supply chain issues and the effects of ongoing Covid all to blame.      
    • US Dollar (DXY) Daily Price and Analysis US Q1 GDP may stall the greenback’s advance. A 20-year high nears for the US dollar. The multi-month US dollar rally continues with the greenback printing a fresh high today ahead of the first look at US Q1 GDP at 12.30 GMT. The US dollar basket (DXY) has been boosted by renewed weakness in the Euro and the Japanese Yen, as investors move from lower-yielding to higher-yielding currencies, while safe-haven flows continue to benefit the greenback. The US growth release later in the session is expected to show a sharp slowdown from the robust Q4 figure of 6.9%. The markets are currently pricing in growth of just 1% for the first three months of this year, with the slowdown mainly due to a reduction in inventory accrual over the quarter. This release is unlikely to move the greenback, unless there is a large miss or beat, as the Fed believe that 2022 US growth will be robust enough to let them tighten monetary policy sharply without damaging the economy. The latest US Core PCE data – the Fed’s preferred inflation reading – is released on Friday and this may have more effect on the US dollar than today’s GDP data. For all market moving economic data and events, see the DailyFX Calendar. The ongoing US dollar rally has been aided by weakness across a range of G7 currencies including the Euro, the Japanese Yen, and the British Pound. The Euro continues to battle with lowly growth expectations, exacerbated by energy concerns, the British Pound is mired by weak economic data, while the Japanese Yen is in freefall as the BoJ continues with its ultra-loose monetary policy.   The US dollar continues to press higher and looks set to break above 103.96, the March 2020 high. Above here the US dollar would be back at levels last seen nearly two decades ago. The March resistance will likely hold in the short-term, especially with month-end portfolio rebalancing at the end of the week, but US dollar strength is set to continue in the months ahead. USDOLLAR (DXY) WEEKLY PRICE CHART – APRIL 28, 2022 {{THE_FUNDAMENTALS_OF_BREAKOUT_TRADING}} What is your view on the US Dollar – bullish or bearish?   Apr 28, 2022 | DailyFX Nick Cawley, Strategist
    • While Tesla has nothing directly to do with Elon Musk buying Twitter - TSLA stock closed down 12% on news that Musk may have to sell stock and use other holdings to stand against the loan to finalise the purchase of the social media giant.        
×
×
  • Create New...