EUR/USD could slump to test 2024 lows due to 3 factors
June 26 (Reuters) -FX traders should beware that a combination of economic, political and technical factors point to a big EUR/USD slump in the days and weeks ahead.
EUR/USD is under pressure after a European Central Bank policymaker talked up the chances of further rate cuts this year, a notably different stance from the Federal Reserve's Michelle Bowman.
There is political uncertainty, as France's snap election looms. Polling points to Marine Le Pen's National Rally (RN) emerging as the largest party, with or without a clear majority to pursue an awkward "cohabitation" with President Macron until the 2027 presidential election.
EUR/USD recently failed well ahead of the 1.0763 Fibo, a 38.2% retrace of the 1.0916 to 1.0668 (June) EBS drop. Fourteen-day momentum remains negative, reinforcing the overall bearish bias. The scope is growing for a break under the 1.0668 low, which in turn will unmask the 2024 1.0602 low for a probe.
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(Martin Miller is a Reuters market analyst. The views expressed are his own)
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