EUR/USD Price Forecast – Euro falls hard on Monday

In a huge risk off move, the Euro has sold off drastically against the US dollar during the day on Monday, as trade tariffs are ready to be slapped on the Chinese this Friday. It looks as if those tariffs are in fact going to be levied, and of course the Chinese will retaliate. Because of this, the trade war situation seems to be getting worse, and that has people running towards the US treasury markets. · FX Empire

Christopher Lewis

Updated Mon, Jul 2, 2018, 10:11 PM

The Euro rallied last week, but those rallies are taking a serious beating during the beginning of this week. The US looks likely to add more tariffs against the Chinese this Friday, and of course the Chinese will retaliate almost immediately. At this point, the tit for tat trade war continues to be on the forefront of most people’s thinking, and with that in mind I think it’s likely that we will continue to see a lot of volatility and fear in the marketplace. Fear almost always benefits the US dollar as people will go looking towards the US treasury markets to protect their trading capital.

At this point, I think that the 1.1500 level underneath is still going to offer a bit of support and breaking below there would of course be a monumental event. I think we are essentially going to trade back and forth between the 1.1500 level on the bottom, and the 1.1700 level on the top. For the next 24 hours though, it looks very likely that the sellers are probably going to have the upper hand.

One thing that could change everything is if there is more of a conciliatory tone coming out of you the Chinese are the Americans over the next couple of days, but at this point I would not look for that to happen.