EUR/USD: suspense on the exchange market

Key graphics elements

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The Euro-Dollar pair is once again at the center of the attention of the markets, against the backdrop of political tensions, monetary uncertainties and determining technical signals.

In the background, Donald Trump continues his verbal attacks against the federal reserve and its president Jerome Powell, accusing him of braking the real estate market with rates deemed too high. This offensive comes on the eve of the annual Jackson Hole symposium, a unmissable meeting of central bankers. Powell’s speech is expected with a particular intensity, investors scrutinizing any index likely to confirm or deny the rate reduction in September. The markets currently assess at more than 80 % the probability of a monetary easing, even if the prudence of the Fed boss in the face of inflationary risks may surprise.

On the European side, Christine Lagarde wanted to put the impact of the recently concluded trade agreement between Washington and Brussels. If the average customs duties stand out slightly above the hypotheses retained by the ECB, they remain far from the extremely dreaded scenario in the spring. For Frankfurt, this compromise does not call into question the basic trajectory of economic projections, which gives certain support for the euro.

On the macroeconomic level, the dynamics remain contrasted. In the United States, consumption inflation remains moderate, around 2.7 % at an annual rate, but prices for production and import signal potential pressure to come. In parallel, the labor market shows signs of breathlessness, even if the unemployment rate remains historically low. This configuration maintains the Dilemma of the Fed between prudence on inflation and the need to revive activity.

Internationally, another factor draws attention: the growing role of stablecoins in the demand for American debt. The Treasury Secretary, Scott Bessent, believes that these digital assets backed by treasury bills could become a key relay to absorb the increase in federal debt. The Stablecoins market, still limited to around 250 billion dollars, could, according to its projections, exceed 2,000 billion in the coming years. This tilting would mark a decisive step in the integration of the crypto sphere with traditional public funding circuits. This information was communicated by the Financial Times.

On the technical level, the configuration of the Euro-Dollar remains constructive. The European motto retains a bias bias as long as it evolves above the strategic threshold of 1.14. The current consolidation sequence appears more as a breathing in the trend than a reversal. In this context, the trade will always be able to consider the scenario of a gradual progression to the 1.20 zone, a level which would constitute the next major target if the current momentum is extended.

In short, the Euro-Dollar is at the crossroads between political arbitrations, monetary decisions and financial innovations. Investors will have to deal with this bundle of uncertainty, while keeping in mind that, technically, the background trend remains favorable to the single currency.

Medium term

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

Our entry point is 1,1646 USD. The course of course in our Haussier scenario is at 1.2000 USD. To preserve the committed capital, we advise you to position a protection stop at 1,1380 USD.

The profitability hope of this Forex strategy is 354 pips and the risk of loss is 266 pips.

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