We may be seeing the formation of a perfect storm for a large move to the downside for the euro-dollar pair.
With signs of a tipping point in the housing market, rocketing energy prices, unemployment rate being at 3.8% and inflation way above the feds 2% target, further supply chain issues, discussions about 4th wave covid concerns, global security worries over Russia and Ukraine.
All this as the pair approaches a very crucial and well respected 22 year trend line.
The trend line has been tested and respected several times over the past 22 years; mainly October 2000 at 0.83, December 2016 1.035, March 2020 1.076 And March 2022 1.101.
Taking the state of the economy, inflation, security and unemployment into account, I think we could very well see a substantial move lower in the currency pair if this support is broken. How low will it go? Only time will tell. But for myself, I anticipate a bearish trend forming later in the year.
With signs of a tipping point in the housing market, rocketing energy prices, unemployment rate being at 3.8% and inflation way above the feds 2% target, further supply chain issues, discussions about 4th wave covid concerns, global security worries over Russia and Ukraine.
All this as the pair approaches a very crucial and well respected 22 year trend line.
The trend line has been tested and respected several times over the past 22 years; mainly October 2000 at 0.83, December 2016 1.035, March 2020 1.076 And March 2022 1.101.
Taking the state of the economy, inflation, security and unemployment into account, I think we could very well see a substantial move lower in the currency pair if this support is broken. How low will it go? Only time will tell. But for myself, I anticipate a bearish trend forming later in the year.