I believe the EURUSD will drop SIGNIFICANTLY (to around 0.8). Here is why:
Europe’s economy is spiraling out of control. Manufacturing is contracting, with the latest PMI figures showing a disastrous 45.1—FAR FAR BELOW the 50 threshold that indicates growth. Energy prices are skyrocketing, businesses are struggling, and consumer confidence is plummeting. The European Central Bank (ECB) is in a state of desperation, resorting to crazy interest rates to salvage the economy, but its efforts are only making the euro less appealing to investors.
The ECB’s actions are signaling its desperation. Governing Council member Yannis Stournaras has already hinted at aggressive rate cuts throughout 2025, aiming to bring rates down to 2% by the end of the year. This move is a death sentence for the euro. Lower rates mean reduced demand for the currency, and investors are fleeing to safer assets. The ECB is essentially handing victory to the dollar on a silver platter.
While the euro is experiencing a significant decline, the U.S. dollar is experiencing a remarkable surge. The Federal Reserve is adopting a cautious approach to rate cuts, indicating that the U.S. still offers higher returns on investments, making the dollar far more attractive compared to the euro. So, investors are abandoning euros and hoarding dollars, accelerating the downward spiral of the euro’s value. Which would in turn make the EURUSD drop
Furthermore, the recent strength in the euro was merely a mirage, as history suggests that such rallies cannot endure. The underlying fundamentals are fundamentally flawed, with the U.S. economy outperforming Europe in terms of growth, innovation, and resilience. The euro’s rise was unsustainable, and now reality is crashing down upon it. The market is correcting, and the euro is plummeting.
Moreover, the bond markets are in turmoil. The U.S. bond market has been aggressively sold off, but China is ramping up its purchases of 10-year T-bills. This influx of capital into the U.S. is further strengthening the dollar, making it difficult for the euro to compete with the demand for U.S. assets.
Additionally, the uncertainty surrounding the trade war between the U.S. and China has shaken global markets. Investors are panicking and seeking safe havens, but the euro is not one of them. The uncertainty surrounding U.S.-China trade relations is driving capital into the dollar, leaving the euro to deteriorate further.
Lastly, my technical analysis suggests that the EUR/USD is in freefall. The pair began 2023 on a rocky path, dropping 0.8% on the first trading day of the year. It has broken key support levels, and traders are rapidly turning bearish. I am expecting a catastrophic crash for the euro based on trendlines, RSI levels and more from the monthly charts, weekly, daily, and even the 4H. No matter what chart you use they all suggest the same idea. The EURUSD will drop.
So I’m shorting. If I am wrong then what the EURUSD has been doing for the past 17 years is about to somehow change, and the news is wrong, the charts wouldn’t add up etc. in that crazy scenario, sure the EURUSD may rise a bit but let me tell you guys.. I am so sure of this, more sure than any other trade. Do your own research and don’t just blindly believe me, but I will be shorting.
Europe’s economy is spiraling out of control. Manufacturing is contracting, with the latest PMI figures showing a disastrous 45.1—FAR FAR BELOW the 50 threshold that indicates growth. Energy prices are skyrocketing, businesses are struggling, and consumer confidence is plummeting. The European Central Bank (ECB) is in a state of desperation, resorting to crazy interest rates to salvage the economy, but its efforts are only making the euro less appealing to investors.
The ECB’s actions are signaling its desperation. Governing Council member Yannis Stournaras has already hinted at aggressive rate cuts throughout 2025, aiming to bring rates down to 2% by the end of the year. This move is a death sentence for the euro. Lower rates mean reduced demand for the currency, and investors are fleeing to safer assets. The ECB is essentially handing victory to the dollar on a silver platter.
While the euro is experiencing a significant decline, the U.S. dollar is experiencing a remarkable surge. The Federal Reserve is adopting a cautious approach to rate cuts, indicating that the U.S. still offers higher returns on investments, making the dollar far more attractive compared to the euro. So, investors are abandoning euros and hoarding dollars, accelerating the downward spiral of the euro’s value. Which would in turn make the EURUSD drop
Furthermore, the recent strength in the euro was merely a mirage, as history suggests that such rallies cannot endure. The underlying fundamentals are fundamentally flawed, with the U.S. economy outperforming Europe in terms of growth, innovation, and resilience. The euro’s rise was unsustainable, and now reality is crashing down upon it. The market is correcting, and the euro is plummeting.
Moreover, the bond markets are in turmoil. The U.S. bond market has been aggressively sold off, but China is ramping up its purchases of 10-year T-bills. This influx of capital into the U.S. is further strengthening the dollar, making it difficult for the euro to compete with the demand for U.S. assets.
Additionally, the uncertainty surrounding the trade war between the U.S. and China has shaken global markets. Investors are panicking and seeking safe havens, but the euro is not one of them. The uncertainty surrounding U.S.-China trade relations is driving capital into the dollar, leaving the euro to deteriorate further.
Lastly, my technical analysis suggests that the EUR/USD is in freefall. The pair began 2023 on a rocky path, dropping 0.8% on the first trading day of the year. It has broken key support levels, and traders are rapidly turning bearish. I am expecting a catastrophic crash for the euro based on trendlines, RSI levels and more from the monthly charts, weekly, daily, and even the 4H. No matter what chart you use they all suggest the same idea. The EURUSD will drop.
So I’m shorting. If I am wrong then what the EURUSD has been doing for the past 17 years is about to somehow change, and the news is wrong, the charts wouldn’t add up etc. in that crazy scenario, sure the EURUSD may rise a bit but let me tell you guys.. I am so sure of this, more sure than any other trade. Do your own research and don’t just blindly believe me, but I will be shorting.
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The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.