Which way will the euro and the dollar go? – stockmarket projections. it
Very bad setback for the euro which during the last two sessions of the week lost more than 2%. It should be noted that such an important decline in such a short time has not been seen since October 2022. On that occasion, the decline had been preparatory to the restart of the single European currency against the dollar. Will history repeat itself? We still have to wait a bit for the answer. Indeed, at the end of February we will know if the euro has finally tamed the dollar. In the meantime, let’s try to illustrate the causes that led to this explosion of the dollar and to understand what the expectations could be for the next sessions.
Why has the euro lost so much against the dollar?
Employment data Americana released Friday showed that more jobs in January grew much more than expected by economists. In this way the Federal Reserve may have more leeway to continue raising interest rates. This is the explanation for the observed rise. However, the situation is very uncertain.
During Wednesday’s session we had witnessed a diametrically opposite movement. At the time, traders had increased bets that the US central bank would stop raising funding costs after a widely expected 25 basis point hike in March.
At the end of February we will know if the euro has finally tamed the dollar: the indications of the graphic analysis
On February 3 the closing of the exchange euro Dollar (FXEURUSD) was at 1.0795, down 1% from the previous session. The week ended down 0.68%.
Weekly time frame
Averages firmly setting upwards on the euro dollar exchange rate on the weekly time frame – projectionsdiborsa.it
For the moment, at a weekly level, the impact of the two heavily downward sessions is not yet visible. To compensate, in fact, there is Wednesday’s session which recorded a strong rise in the euro. Decisivetherefore, they could be the next closures weekly.
Monthly time frame
Exceptional January close could aid long-term euro recovery
After four consecutive months on the risethe likes of which have not been seen since 2020, there could be all the conditions for a long-term trend reversal. As can be seen from the graph, in fact, the averages could be about to cross. Everything, however, will depend on the February closure.
We note that at current levels there is a situation of extreme equilibrium with the two averages having the same value. That is why we will know at the end of February whether the euro has finally tamed the dollar.
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