The EURUSD pair has been stuck in a 100 pip range for about 3 weeks now and it is only a matter of time before it breaks out one way or the other.
I have a very bearish view of the EURO based on the fact that the ECB has no plans to increase interest rates in the foreseeable future and the economy looking fragile.
In the US, Trump has stated that he wants low interest rates and a weak US dollar has he knows that both of these would give him the best shot at growing the US economy and cementing a second term.
According to the FED chairman, Jerome Powell, however, the US economy is flying, which justifies a continuation of interest rate hikes to control an overheating economy. Powell is ignoring Trumps manufactured trade wars and is sticking to his guns.
How Trump and Powell have completely different agendas and views is odd considering Trump put him into this role in the first place.
The trigger to push the EURUSD lower will likely come from the ECB press conference this Thursday. At his last conference in June, Draghi, the ECB head, caused a major fall in the EURUSD pair and I don’t see him doing a big turnaround now and talking the EURO up.
Draghi wants a weak EURO, so is more similar to Trump than his counterpart at the FED.
Remember, much of your success in trading will come down to the timing of your trades. Don’t be surprised if the EURO falls well before the press conference as traders pre-empt the move. Best of luck!
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