The single European currency remains above the 1,05 level as the soft reaction momentum was maintained and yesterday.
The eurozone data continues to be a concern and remains one of the main weights in the path of the single European currency recently, such as yesterday’s announcement about German exports, which fell more than expected.
While regarding the rhetoric of the two central banks there is nothing new on the table with the general sentiment favoring the US dollar for now as the Fed‘s decision not to raise interest rates further but to send the message to the markets that they will be kept high for long time has not yet faded.
But something that, as I mentioned in a previous article, my assessment is that it will happen Sooner or later and will limit the dynamics of the US dollar with the consequence that some larger reaction from the European currency will appear again on the table.
Yesterday’s weekly initial jobless claims data came as no surprise and now all the focus is today on the United States unemployment and new jobs announcement which traditionally creates a lot of volatility in the exchange rate.
And yesterday’s general market behavior partially confirmed my thinking as mentioned in the previous article as although the general environment continues to favor the US currency I refuse to position myself at these levels in favor of the dollar as I consider that the risk of a change a direction is quite significant.
In any case waiting for a very crucial event later in the afternoon any bets are risky as any possible surprise to one side or the other is capable of changing the conditions and from the next there be a different picture on the table.
A balanced announcement won‘t take me way me from my main thoughts of preferring to buy the euro on dips and especial in new local lows.
