EUR/USD: the traders take note of the German legislative elections

(BFM Stock Exchange) – This article, with free access, is produced by the research team in BFM Stock Exchange analysis and market strategy. To not miss any opportunity, consult all of the analyzes and discover our portfolios by accessing our privilege space.

The pair of Euro / dollar currencies, although in chronic downward trend, has just experienced a higher since January 27, in the wake of the results of the anticipated legislative elections in Germany. These elections did not reserve a big surprise. The Conservatives, namely the CDU/CSU are, as expected, clearly brought out in mind, with 28.52% of the votes. According to ZDFILS public television is ahead of the far-right party, AFD (20.80%) , Socialists (SPD), credited with a score of 16.41%, as well as environmentalists (11.61%) and “Die Linke”, a party of Radical left, at 8.77%.

The markets may hope that these results lead to a government which will take measures favorable to the economy, while Germany remains over two years of decline in its GDP. “The final composition of the coalition is not yet clear, but it is likely that it is favorable to a certain budgetary relaxation, which would be good news for actions”, judge Barclays.

Hope with the new coalition, which will most likely be directed by Friedrich Merz, is that of an investment vice loosening, softening the budget gold rule which prevailed under Olaf Scholz.

“The frequently expressed demand for competitive energy and electricity costs is therefore particularly important for German energy industry. This goes hand in hand with investments in a more efficient electricity transport infrastructure and in many Other areas of infrastructure “, analyzes Christoph Berger, CIO Equity Europe, in reactions to the German legislative elections of 2025.”

“It is necessary to invest more in the defense sector. However, the” best “investment is that in education, with the simultaneous promotion of knowledge transfer to the economy. A more attractive environment for start-ups UPS – or for research and development in general – could also help innovations become commercial success. “

The German industry, erected as a model, although still powerful, has lost its superb in recent years, during which “the main pillars of the Germany growth model have been more and more weakened. This model rested On a globalized and secure world, where exchanges were relatively free. affected Germany “, for Lowie DEBOU, fixed in Fund Manager at DPAM.

In the statistical chapter, the very first estimates of activity barometers in the euro zone emerged under the expectations for services (50.7) and above for industry (47.3). In addition to the Atlantic, consumers’ morale has significantly deteriorated in February. The confidence index of the University of Michigan clearly bent at 64.7 this month, against 71.7 in January. In addition, the composite PMI index, which brings together manufacturing production and services, emerged at 50.4, after 52.7 points in January, bringing it closer to the 50 -point threshold, which marks the border between an expansion and a contraction of the activity.

This Monday, the trades learned of consumer prices (ICC) in final data for the month of January, in the euro zone. Excluding food, energy, alcohol and tobacco, prices raised up 2.7% at an annual rate, in accordance with the first estimates.

At midday on the foreign exchange market, the euro was treated against $ 1,0470 approximately.

Key graphics elements

The continuous 50 -day (in orange) mobile average constitutes a solid technical and graphic barrier. In the shorter term, it is even his counterpart at 20 days (in dark blue) that officiates as a dynamic resistance. And this without the RSI oscillator positioning itself in the occurrence zone. In the immediate future, the pair of currencies traces, in the upper part of the Bollinger bands, a negative structure in harami. Once the parity is perfect, namely $ 1 for a €, an energetic buyer of protest can then be set up.

Medium term

In view of the key graphic factors that we have mentioned, our opinion is negative in the medium term on Euro dollar parity (Eurusd).

Our entry point is 1,0472 USD. The price of course in our lowering scenario is 1,0001 USD. To preserve the committed capital, we advise you to position a protection stop at 1,0611 USD.

The profitability hope of this Forex strategy is 471 pips and the risk of loss is 139 pips.

Daily data graphics