The single European currency is falling back below the 1.08 level after yesterday’s reaction.
Yesterday did not bring any surprises and the reaction of the European currency was quite expected, especially in view of today’s very important data on new jobs in the United States, as a large part of investors preferred to take a wait-and-see attitude, limiting the open positions in favor of the US currency in recent days.
The behavior of the market has confirmed the thought expressed in previous articles, when I pointed out that the mild downward momentum remains in play, but in view of the very important data of Friday, this will not take much scope and the reaction of the European currency is very likely to return to the front.
Yesterday’s reaction can certainly not be characterized as a change in direction and the limited range of variation is expected to remain until noon and the important announcements.
Yesterday’s data on the path of the European economy confirmed that the specter of recession continues to linger and as the Eurozone economy continues to struggle, the European currency will find it very difficult to repeat November’s strong rise.
Non-farm payrolls in the U.S. traditionally act as a trigger to change the game when there are significant deviations from estimates and for this reason the continuation of the day is awaited with great interest.
At the same time, the release of the University of Michigan’s consumer sentiment index is also of interest, as the market often “listens” with sensitivity.
It is obvious that a wait-and-see approach ahead of the announcements would be the best idea.
My thoughts to buy the US currency at the levels of 1.10 and above, although it turned out to be quite correct, unfortunately I could not implement it, as I expected even higher levels.