The German elections went as expected, the next step is to form a viable coalition which is of course we'll have some ups and downs, but generally speaking I'm bullish on the euro for several reasons.
First of all, the biggest treat that Donald Trump will impose some kind of tariffs on the European Union is high but also the impact is not as severe as we anticipate. Well he can do it, as he wish but at the same time European Union also can hit hard, on the other hand if the Ukrain War will end, that will give a substantial boost for the European economy.
The USA is isn't in the situation where he can take several front trade Wars with everyone , without literally destroying their own economy. Just to bemore exact they cannot let that interest rates getting higher since it will directly affect the government interest payment on their future debts issuence which is already freakinghigh.
At least not now .
Inflation in the European Union is coming down which is also indicating that may the ECB have to cut once again the interest rate, that's that's not matter anymore because more or less it's already baked into the price, and we are already looking for the next cycle of red hikes, but until then this is a one-way Direction. It's up. Do you say it sooner or later will be forced also to lower the interest rates which gradually will take out the interest of the US dollar, hence the Euro again just getting another catalyst.
Price targe 1,0617-1,0650
DEEP buy 1,0375
FROM THE CURRENT LEVELS ONLY MODERATE BUYS. FOCUS IN PULLBACKS AND BIGGEN THAN -0,75%
First of all, the biggest treat that Donald Trump will impose some kind of tariffs on the European Union is high but also the impact is not as severe as we anticipate. Well he can do it, as he wish but at the same time European Union also can hit hard, on the other hand if the Ukrain War will end, that will give a substantial boost for the European economy.
The USA is isn't in the situation where he can take several front trade Wars with everyone , without literally destroying their own economy. Just to bemore exact they cannot let that interest rates getting higher since it will directly affect the government interest payment on their future debts issuence which is already freakinghigh.
At least not now .
Inflation in the European Union is coming down which is also indicating that may the ECB have to cut once again the interest rate, that's that's not matter anymore because more or less it's already baked into the price, and we are already looking for the next cycle of red hikes, but until then this is a one-way Direction. It's up. Do you say it sooner or later will be forced also to lower the interest rates which gradually will take out the interest of the US dollar, hence the Euro again just getting another catalyst.
Price targe 1,0617-1,0650
DEEP buy 1,0375
FROM THE CURRENT LEVELS ONLY MODERATE BUYS. FOCUS IN PULLBACKS AND BIGGEN THAN -0,75%
Note
As I mentioned, the focus is on pullbacks.The major catalyst and de-catalyst is the peace deal between Ukraine and Russia. However, until now, I have not considered how Europe will profit from it in the long run, but on short run its will be cause 2,00-2,5% upward movement in case of aggrement.
Trade active
Whats can go wrong?Obviously if the USA hits European Union with tarrifs.
10%< Expected drop in the price is -3,5%
10%> 6-8% ( Higly unlikely ) but its trump era.
Note
Accumulation is ongoing, as China clearly announced yesterday that they are opening up to Europe. India is also engaging in meaningful political conversations with the EU, which suggests that the USA will gradually be replaced.At the same time, I have no clue right now how the market will react in the case of reciprocal tariffs. Will it move to the downside and then suddenly recover, or will it completely ignore it?
A few things are certain:
1 .The USA's efforts seem to be working against them on all fronts—economically and politically.
2. Europe is determined to become independent from the USA.
3 .Russia will not attack Europe in the near future.
Note
This week, the major highlight for the Euro will be the European Central Bank (ECB) monetary policy meeting, scheduled for Thursday. The ECB is almost certain to cut its Deposit Facility Rate by 25 basis points (bps) to 2.5%. This would be the fifth straight interest rate cut by the ECB. Traders have been increasingly confident about the ECB reducing its borrowing rates again amid fears that US President Donald Trump’s tariff agenda will damage the economic growth of the shared continent. Such a scenario would keep Eurozone inflationary pressures persistently below the ECB’s target of 2%.
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Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.