Open trading account There are some topics about EurUsd, but there is one that is the most important for all Fx Traders: "EURUSD goes to parity?"
This is the chart of EurUsd on an important timeframe that is 1 month. This timeframe is crucial for an investment decision on a long term investment strategy and it's clear that the euro don't want to go to 1,000.
The Blue Area represent the BULL Area of EurUsd and it's clear that the price action on this timeframe is looking for a reversal: in 2 years, the low area seems to be always bought, but there is an important thing to underline
The last Bearish movement from 1,1290 area, seems to be stopped on the low area, when all the market sentiment is bearish for this major. Neither the last FOMC meeting pushed Euro to the parity, and it could have been a very important opportunity for the Euro Bear Trades.
What about MACRO?
1) USD: The FOMC and Janet Yellen announced three rate hikes and this event is just discounted by the Fx market. There is no more suspance on the next FOMC meetings about the event "rate hike". If the FED will not increase its rates, the EurUsd could be moved just to higher prices as a "surprise effect" of the "non-rate hike"
2) EUR: The Euro Area and the ECB are going to face an higher inflation. The Inflation in EU is 1,10%, perfectly in the target area of 1%-2%. In this condition, there is no need for Mario Draghi to extend monetary policy easings for the economic and financial system in Europe. The problem in Europe is the banking system that doesn't extend credit, especially in country like Italy that has the NPLs (Non Performing Loans) problem.
3) US PUBLIC DEBT & EXPORTS : A very strong Usd (Dollar Index above 100) is a big problem for Us and could be a potential damage on the long term. On the last 8 years, the US economy have seen a huge increase of its public debt and now it's over 18 trillion $ with a debt/Gdp over 100%. A EurUsd lower than 1,000 could be a problem because the increase of the Value of USD in real terms. Also there could be a problem in the exports and a EurUsd staying just few figures above parity is not sustainable on the long term both for USA and Europe.
EURUSD Expectations
From the Area 1,03-1,05 there could be a Bullish impulse to higher levels at 1,08. From this area there could be a correction and another impulse to 1,10-1,12 for the second half of this year. If we want to have to stay focused on the nature of these future movements, we have to analyze lower timeframe as Weekly and Daily, just to have a more clear view on this pair.
