The trend of the Euro against the other large currencies has been down and is expected to continue down, as the Europen economic bloc moves towards easing monetary and fiscal policy in order to stimulate inflation and growth. The Forex industry is not looking kindly on Euro in the long term. But, before we get into the long term analysis on the topic of Euro, it is important that we start discussing the short term, the current situation and the expectations for the short term developments for the currency.
The Friday of August 16, 2019, the Forex market closed with the Euro down in comparison with the USD and the GBP. This was caused by the fact that the US treasury yields were able to strengthen by the end of the week. The fact that the US economy strengthened unexpectedly for a short time, while the Euro economy did not necessarily improve in the short period of time, resulted in the fall of Forex value for the Euro. But, it seems things might be changing as the US economy is again showing signs of weakness. Although the US retail sales reports showed some positive results, the recent Chinese announcements of additional tariffs might be caused to believe another adjustment, with the Euro gaining a little on the USD.
On the other hand, it looks like the Euro struggled against the GBP on the Forex market as well. The Euro adjusted down a little bit, with the expectations of interest rate adjustments and the quantitative easing adjustment expectations for the Eu government. This trend is not going to continue for long, as the GBP looks to be getting weaker in the coming weeks, with the Brexit situation only getting worse with time.
At the end of last week, the Euro USD trading rate sat at 1.1090, down from 1.110. This week the EUR/USD remains at 1.1093. The Euro/GBP sat at 0.9326 at the end of Thursday, 23/08/2019.
Long term outlook
It is expected on the FX market that the EUR is only going to keep going down lower, or at least so say the weekly swing stats. The lowest point that the Euro is going to hit this week is going to be 1.1027, which will mean that the downtrend is starting. The lowest major point for the EUR/USD is going to be 1.0659. Although there are still expectations that the high point that will be hit will be somewhere around 1.1413, although this is going to follow a prolonged move down and might have a hard time happening if the US economy continues to strengthen further. The expectations for this week have been determined by the reactions of the trader to the Gann angle. The same is going to be true for the next week, as traders adjust to the news of additional Chinese tariffs to the US and try to move away from USD to Euro for safety. For now, the expectations are that of pessimism and a downtrend coming in the near future.