Potential EUR/USD trade

It has been one-way traffic in the single currency for a while and EUR/USD will be back in focus today as Mario Draghi is set to speak.

Source: Bloomberg

The ECB’s TLTRO allotment last week didn’t obtain the sort of uptake investors would have wanted to see, and this seems to have put a dampener on the euro again. Draghi will be testifying before the European Parliament’s economic and monetary committee and this should help shed some light on the current state of the economy and plans for action.

The pair traded at its lowest since July last year at the open this morning and I feel it is likely the pair will test July 2013 lows at $1.2755 in the near term. EUR/USD is currently trading at $1.2834 and strength could be used as an opportunity to sell. Traders could consider selling a recovery to $1.2900 with targets towards the July 2013 lows. Once triggered, stops will have to be placed above $1.3000.

Click to enlarge

IGA, may distribute information/research produced by its respective foreign marketing partners within the IG Group of companies pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the research is distributed in Singapore to a person who is not an Accredited Investor, Expert Investor or an Institutional Investor, IGA accepts legal responsibility for the contents of the report to such persons only to the extent required by law. Singapore recipients should contact IGA at 6390 5118 for matters arising from, or in connection with the information distributed.

This information/research prepared by IGA or IGA Group is intended for general circulation. It does not take into account the specific investment objectives, financial situation or particular needs of any particular person. You should take into account your specific investment objectives, financial situation or particular needs before making a commitment to trade, including seeking advice from an independent financial adviser regarding the suitability of the investment, under a separate engagement, as you deem fit. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. In addition to the disclaimer above, the information does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. Any views and opinions expressed may be changed without an update.

See important Research Disclaimer.